The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on September 30th, about a month before the elections. We at Insider Monkey have made an extensive database of more than 817 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Exelixis, Inc. (NASDAQ:EXEL) based on those filings.
Is EXEL a good stock to buy? Exelixis, Inc. (NASDAQ:EXEL) investors should be aware of a decrease in enthusiasm from smart money in recent months. Exelixis, Inc. (NASDAQ:EXEL) was in 34 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 39. Our calculations also showed that EXEL isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
According to most traders, hedge funds are perceived as worthless, outdated investment vehicles of yesteryear. While there are more than 8000 funds with their doors open at present, Our experts choose to focus on the upper echelon of this group, around 850 funds. It is estimated that this group of investors oversee bulk of all hedge funds’ total capital, and by observing their first-class picks, Insider Monkey has come up with numerous investment strategies that have historically surpassed the market. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
Robert Pohly of Samlyn Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 15 best blue chip stocks to buy to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind let’s take a gander at the latest hedge fund action regarding Exelixis, Inc. (NASDAQ:EXEL).
Do Hedge Funds Think EXEL Is A Good Stock To Buy Now?
At Q3’s end, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from one quarter earlier. By comparison, 30 hedge funds held shares or bullish call options in EXEL a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Exelixis, Inc. (NASDAQ:EXEL) was held by Renaissance Technologies, which reported holding $554.2 million worth of stock at the end of September. It was followed by Farallon Capital with a $262.8 million position. Other investors bullish on the company included Polar Capital, OrbiMed Advisors, and AQR Capital Management. In terms of the portfolio weights assigned to each position Farallon Capital allocated the biggest weight to Exelixis, Inc. (NASDAQ:EXEL), around 1.86% of its 13F portfolio. Sectoral Asset Management is also relatively very bullish on the stock, designating 1.8 percent of its 13F equity portfolio to EXEL.
Seeing as Exelixis, Inc. (NASDAQ:EXEL) has faced bearish sentiment from the aggregate hedge fund industry, it’s easy to see that there lies a certain “tier” of money managers who sold off their positions entirely heading into Q4. At the top of the heap, Robert Pohly’s Samlyn Capital said goodbye to the largest stake of all the hedgies tracked by Insider Monkey, worth about $24 million in stock, and Bhagwan Jay Rao’s Integral Health Asset Management was right behind this move, as the fund cut about $3.6 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 5 funds heading into Q4.
Let’s check out hedge fund activity in other stocks similar to Exelixis, Inc. (NASDAQ:EXEL). We will take a look at Alteryx, Inc. (NYSE:AYX), F5 Networks, Inc. (NASDAQ:FFIV), JFrog Ltd. (NASDAQ:FROG), NRG Energy Inc (NYSE:NRG), RH (NYSE:RH), Sibanye Stillwater Limited (NYSE:SBSW), and Alleghany Corporation (NYSE:Y). This group of stocks’ market caps resemble EXEL’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AYX | 41 | 1192864 | -7 |
| FFIV | 36 | 806699 | -3 |
| FROG | 22 | 288909 | 22 |
| NRG | 32 | 1086627 | -4 |
| RH | 40 | 1623869 | 0 |
| SBSW | 22 | 208952 | 5 |
| Y | 29 | 306105 | -2 |
| Average | 31.7 | 787718 | 1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 31.7 hedge funds with bullish positions and the average amount invested in these stocks was $788 million. That figure was $1173 million in EXEL’s case. Alteryx, Inc. (NYSE:AYX) is the most popular stock in this table. On the other hand JFrog Ltd. (NASDAQ:FROG) is the least popular one with only 22 bullish hedge fund positions. Exelixis, Inc. (NASDAQ:EXEL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for EXEL is 57.7. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 33.3% in 2020 through December 18th and beat the market again by 16.4 percentage points. Unfortunately EXEL wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on EXEL were disappointed as the stock returned -18.4% since the end of September (through 12/18) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Follow Exelixis Inc. (NASDAQ:EXEL)
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Disclosure: None. This article was originally published at Insider Monkey.
