Is Osiris Therapeutics, Inc. (OSIR) A Good Stock To Buy?

It seems that the masses and most of the financial media hate hedge funds and what they do, but why is this hatred of hedge funds so prominent? At the end of the day, these asset management firms do not gamble the hard-earned money of the people who are on the edge of poverty. Truth be told, most hedge fund managers and other smaller players within this industry are very smart and skilled investors. Of course, they may also make wrong bets in some instances, but no one knows what the future holds and how market participants will react to the bountiful news that floods in each day.

The S&P 500 Index gained 7.6% in the 12 month-period that ended November 21, while less than 49% of its stocks beat the benchmark. In contrast, the 30 most popular mid-cap stocks among the top hedge fund investors tracked by the Insider Monkey team returned 18% over the same period, which provides evidence that these money managers do have great stock picking abilities. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Osiris Therapeutics, Inc. (NASDAQ:OSIR) .

Osiris Therapeutics, Inc. (NASDAQ:OSIR) investors should pay attention to a decrease in support from the world’s most successful money managers in recent months. There were 9 hedge funds in our database with OSIR positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Gencor Industries, Inc. (DE) (NASDAQ:GENC), Adverum Biotechnologies Inc (NASDAQ:ADVM), and Ocular Therapeutix Inc (NASDAQ:OCUL) to gather more data points.

RAJ CREATIONZS / shutterstock.com

Now, we’re going to view the latest action encompassing Osiris Therapeutics, Inc. (NASDAQ:OSIR).

Hedge fund activity in Osiris Therapeutics, Inc. (NASDAQ:OSIR)

At the end of the third quarter, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -22% from the second quarter of 2016. The graph below displays the number of hedge funds with bullish position in OSIR over the last 5 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to Insider Monkey’s hedge fund database, Julian Baker and Felix Baker’s Baker Bros. Advisors has the most valuable position in Osiris Therapeutics, Inc. (NASDAQ:OSIR), worth close to $2.5 million, accounting for less than 0.1%% of its total 13F portfolio. Coming in second is Renaissance Technologies, one of the largest hedge funds in the world, holding a $1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions comprise D. E. Shaw’s D E Shaw, Ken Fisher’s Fisher Asset Management and Murray Stahl’s Horizon Asset Management. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that said goodbye to their entire stakes in the stock during the third quarter. Intriguingly, Glenn Russell Dubin’s Highbridge Capital Management said goodbye to the biggest stake of all the investors followed by Insider Monkey, comprising close to $0.1 million in stock. Ken Griffin’s fund, Citadel Investment Group, also sold off its call options, about $0.1 million worth.

Let’s now review hedge fund activity in other stocks similar to Osiris Therapeutics, Inc. (NASDAQ:OSIR). These stocks are Gencor Industries, Inc. (DE) (NASDAQ:GENC), Adverum Biotechnologies Inc (NASDAQ:ADVM), Ocular Therapeutix Inc (NASDAQ:OCUL), and Avenue Income Credit Strategies Fund (NYSE:ACP). This group of stocks’ market caps resemble OSIR’s market cap.

As you can see these stocks had an average of 6.25 hedge funds with bullish positions and the average amount invested in these stocks was $9 million. That figure was $4 million in OSIR’s case. Adverum Biotechnologies Inc (NASDAQ:ADVM) is the most popular stock in this table. On the other hand Gencor Industries, Inc. (DE) (NASDAQ:GENC) is the least popular one with only 4 bullish hedge fund positions. Osiris Therapeutics, Inc. (NASDAQ:OSIR) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard ADVM might be a better candidate to consider taking a long position in.