Is PHR Stock A Buy or Sell?

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 have processed the filings of the more than 887 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their December 31st holdings, data that is available nowhere else. Should you consider Phreesia, Inc. (NYSE:PHR) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.

Is PHR stock a buy? Phreesia, Inc. (NYSE:PHR) was in 26 hedge funds’ portfolios at the end of December. The all time high for this statistic is 22. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. PHR investors should be aware of an increase in enthusiasm from smart money recently. There were 22 hedge funds in our database with PHR positions at the end of the third quarter. Our calculations also showed that PHR isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

To the average investor there are a large number of tools stock market investors employ to evaluate stocks. Some of the most useful tools are hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the top picks of the best hedge fund managers can outperform the market by a healthy margin (see the details here).

Kris Jenner of Rock Springs Capital Management

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Do Hedge Funds Think PHR Is A Good Stock To Buy Now?

At the end of December, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of 18% from one quarter earlier. On the other hand, there were a total of 16 hedge funds with a bullish position in PHR a year ago. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).

The largest stake in Phreesia, Inc. (NYSE:PHR) was held by ARK Investment Management, which reported holding $71.4 million worth of stock at the end of December. It was followed by Rock Springs Capital Management with a $46.1 million position. Other investors bullish on the company included Millennium Management, Light Street Capital, and Driehaus Capital. In terms of the portfolio weights assigned to each position Tamarack Capital Management allocated the biggest weight to Phreesia, Inc. (NYSE:PHR), around 1.92% of its 13F portfolio. Rock Springs Capital Management is also relatively very bullish on the stock, dishing out 0.98 percent of its 13F equity portfolio to PHR.

As industrywide interest jumped, specific money managers have jumped into Phreesia, Inc. (NYSE:PHR) headfirst. Light Street Capital, managed by Glen Kacher, created the most valuable position in Phreesia, Inc. (NYSE:PHR). Light Street Capital had $17.7 million invested in the company at the end of the quarter. Chuck Royce’s Royce & Associates also made a $8.7 million investment in the stock during the quarter. The other funds with brand new PHR positions are Joseph Edelman’s Perceptive Advisors, Matthew Hulsizer’s PEAK6 Capital Management, and Mika Toikka’s AlphaCrest Capital Management.

Let’s also examine hedge fund activity in other stocks similar to Phreesia, Inc. (NYSE:PHR). These stocks are Chimera Investment Corporation (NYSE:CIM), Accolade, Inc. (NASDAQ:ACCD), Spirit Airlines Incorporated (NYSE:SAVE), Workhorse Group, Inc. (NASDAQ:WKHS), Bottomline Technologies (de), Inc. (NASDAQ:EPAY), Veoneer, Inc. (NYSE:VNE), and Lions Gate Entertainment Corporation (NYSE:LGF-B). This group of stocks’ market valuations match PHR’s market valuation.

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As you can see these stocks had an average of 18.3 hedge funds with bullish positions and the average amount invested in these stocks was $182 million. That figure was $250 million in PHR’s case. Spirit Airlines Incorporated (NYSE:SAVE) is the most popular stock in this table. On the other hand Veoneer, Inc. (NYSE:VNE) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Phreesia, Inc. (NYSE:PHR) is more popular among hedge funds. Our overall hedge fund sentiment score for PHR 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. Unfortunately PHR wasn’t nearly as popular as these 30 stocks and hedge funds that were betting on PHR were disappointed as the stock returned -8.9% since the end of the fourth quarter (through 4/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.

Disclosure: None. This article was originally published at Insider Monkey.