The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 866 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article we look at what those investors think of Lexaria Bioscience Corp. (NASDAQ:LEXX).
Is LEXX a good stock to buy? Investors who are in the know were taking an optimistic view. The number of long hedge fund bets improved by 4 lately. Lexaria Bioscience Corp. (NASDAQ:LEXX) was in 4 hedge funds’ portfolios at the end of March. Our calculations also showed that LEXX isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Ken Griffin of Citadel Investment Group
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $28 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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 homepage. With all of this in mind let’s review the key hedge fund action encompassing Lexaria Bioscience Corp. (NASDAQ:LEXX).
Do Hedge Funds Think LEXX Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 4 from one quarter earlier. On the other hand, there were a total of 0 hedge funds with a bullish position in LEXX a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Invenomic Capital Management, managed by Ali Motamed, holds the biggest position in Lexaria Bioscience Corp. (NASDAQ:LEXX). Invenomic Capital Management has a $1.7 million position in the stock, comprising 0.4% of its 13F portfolio. Coming in second is Armistice Capital, led by Steven Boyd, holding a $0.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other members of the smart money that are bullish consist of Hal Mintz’s Sabby Capital, Ken Griffin’s Citadel Investment Group and . In terms of the portfolio weights assigned to each position Invenomic Capital Management allocated the biggest weight to Lexaria Bioscience Corp. (NASDAQ:LEXX), around 0.37% of its 13F portfolio. Sabby Capital is also relatively very bullish on the stock, designating 0.14 percent of its 13F equity portfolio to LEXX.
As aggregate interest increased, specific money managers have jumped into Lexaria Bioscience Corp. (NASDAQ:LEXX) headfirst. Invenomic Capital Management, managed by Ali Motamed, assembled the most valuable position in Lexaria Bioscience Corp. (NASDAQ:LEXX). Invenomic Capital Management had $1.7 million invested in the company at the end of the quarter. Steven Boyd’s Armistice Capital also initiated a $0.9 million position during the quarter. The other funds with new positions in the stock are Hal Mintz’s Sabby Capital and Ken Griffin’s Citadel Investment Group.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Lexaria Bioscience Corp. (NASDAQ:LEXX) but similarly valued. These stocks are Planet Green Holdings Corp. (NYSE:PLAG), Cypress Energy Partners, L.P. (NYSE:CELP), Obalon Therapeutics, Inc. (NASDAQ:OBLN), Forward Industries, Inc. (NASDAQ:FORD), Coffee Holding Co., Inc. (NASDAQ:JVA), Performance Shipping Inc. (NASDAQ:PSHG), and Tenax Therapeutics Inc (NASDAQ:TENX). All of these stocks’ market caps are similar to LEXX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PLAG | 2 | 183 | 2 |
| CELP | 1 | 108 | 1 |
| OBLN | 3 | 3397 | 1 |
| FORD | 2 | 2618 | 1 |
| JVA | 2 | 3908 | 0 |
| PSHG | 3 | 1054 | 2 |
| TENX | 3 | 5289 | -1 |
| Average | 2.3 | 2365 | 0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.3 hedge funds with bullish positions and the average amount invested in these stocks was $2 million. That figure was $3 million in LEXX’s case. Obalon Therapeutics, Inc. (NASDAQ:OBLN) is the most popular stock in this table. On the other hand Cypress Energy Partners, L.P. (NYSE:CELP) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Lexaria Bioscience Corp. (NASDAQ:LEXX) is more popular among hedge funds. Our overall hedge fund sentiment score for LEXX is 89. 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. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks returned 17.2% in 2021 through June 11th but still managed to beat the market by 3.3 percentage points. Hedge funds were also right about betting on LEXX as the stock returned 16.8% since the end of March (through 6/11) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Follow Lexaria Bioscience Corp. (OTCMKTS:LEXX)
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Disclosure: None. This article was originally published at Insider Monkey.