Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds and investors’ positions as of the end of the third quarter. You can find write-ups about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves and analyze what the smart money thinks of MacroGenics Inc (NASDAQ:MGNX) based on that data.
MacroGenics Inc (NASDAQ:MGNX) investors should pay attention to an increase in hedge fund interest in recent months. MGNX was in 19 hedge funds’ portfolios at the end of September. There were 18 hedge funds in our database with MGNX holdings at the end of the previous quarter. Our calculations also showed that mgnx isn’t among the 30 most popular stocks among hedge funds.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let’s review the recent hedge fund action regarding MacroGenics Inc (NASDAQ:MGNX).
What have hedge funds been doing with MacroGenics Inc (NASDAQ:MGNX)?
At the end of the third quarter, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. On the other hand, there were a total of 12 hedge funds with a bullish position in MGNX at the beginning of this year. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, EcoR1 Capital was the largest shareholder of MacroGenics Inc (NASDAQ:MGNX), with a stake worth $31.8 million reported as of the end of September. Trailing EcoR1 Capital was Point72 Asset Management, which amassed a stake valued at $24.3 million. Prosight Capital, 683 Capital Partners, and Rock Springs Capital Management were also very fond of the stock, giving the stock large weights in their portfolios.
Consequently, some big names were breaking ground themselves. Endurant Capital Management, managed by Vishal Saluja and Pham Quang, established the biggest position in MacroGenics Inc (NASDAQ:MGNX). Endurant Capital Management had $0.8 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also initiated a $0.5 million position during the quarter. The other funds with brand new MGNX positions are Paul Marshall and Ian Wace’s Marshall Wace LLP, Thomas Bailard’s Bailard Inc, and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.
Let’s now take a look at hedge fund activity in other stocks similar to MacroGenics Inc (NASDAQ:MGNX). These stocks are Nanometrics Incorporated (NASDAQ:NANO), National Presto Industries Inc. (NYSE:NPK), Solar Capital Ltd. (NASDAQ:SLRC), and Regis Corporation (NYSE:RGS). This group of stocks’ market valuations are similar to MGNX’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NANO | 17 | 113034 | 0 |
| NPK | 10 | 100968 | 0 |
| SLRC | 11 | 57724 | 0 |
| RGS | 15 | 138608 | 1 |
| Average | 13.25 | 102584 | 0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.25 hedge funds with bullish positions and the average amount invested in these stocks was $103 million. That figure was $95 million in MGNX’s case. Nanometrics Incorporated (NASDAQ:NANO) is the most popular stock in this table. On the other hand National Presto Industries Inc. (NYSE:NPK) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks MacroGenics Inc (NASDAQ:MGNX) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: None. This article was originally published at Insider Monkey.
