Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Neovasc Inc. (NASDAQ:NVCN).
Is Neovasc Inc. (NASDAQ:NVCN) worth your attention right now? The smart money was betting on the stock. The number of bullish hedge fund bets went up by 2 lately. Neovasc Inc. (NASDAQ:NVCN) was in 5 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 7. Our calculations also showed that NVCN isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 3 hedge funds in our database with NVCN holdings at the end of December.
In the financial world there are a multitude of gauges shareholders have at their disposal to appraise their holdings. Two of the best gauges are hedge fund and insider trading activity. We have shown that, historically, those who follow the top picks of the best money managers can outperform the market by a solid margin (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .
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 owns nearly 40% of this $23 biotech stock and is trying to buy the rest for around $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. Now we’re going to analyze the new hedge fund action surrounding Neovasc Inc. (NASDAQ:NVCN).
Do Hedge Funds Think NVCN Is A Good Stock To Buy Now?
At Q1’s end, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 67% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards NVCN over the last 23 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Magnetar Capital was the largest shareholder of Neovasc Inc. (NASDAQ:NVCN), with a stake worth $0.8 million reported as of the end of March. Trailing Magnetar Capital was Renaissance Technologies, which amassed a stake valued at $0.5 million. Citadel Investment Group, Two Sigma Advisors, and ExodusPoint Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Magnetar Capital allocated the biggest weight to Neovasc Inc. (NASDAQ:NVCN), around 0.01% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, dishing out 0.0006 percent of its 13F equity portfolio to NVCN.
With a general bullishness amongst the heavyweights, some big names have jumped into Neovasc Inc. (NASDAQ:NVCN) headfirst. Renaissance Technologies, assembled the biggest position in Neovasc Inc. (NASDAQ:NVCN). Renaissance Technologies had $0.5 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also made a $0 million investment in the stock during the quarter.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Neovasc Inc. (NASDAQ:NVCN) but similarly valued. These stocks are Ossen Innovation Co Ltd (NASDAQ:OSN), Sigma Labs, Inc. (NASDAQ:SGLB), Supercom Ltd (NASDAQ:SPCB), VerifyMe, Inc. (NASDAQ:VRME), FARMMI, INC. (NASDAQ:FAMI), WVS Financial Corp. (NASDAQ:WVFC), and China Xiangtai Food Co., Ltd. (NASDAQ:PLIN). This group of stocks’ market values are closest to NVCN’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| OSN | 1 | 481 | 0 |
| SGLB | 3 | 627 | 1 |
| SPCB | 1 | 122 | -2 |
| VRME | 1 | 75 | 0 |
| FAMI | 2 | 507 | 1 |
| WVFC | 1 | 2053 | 0 |
| PLIN | 2 | 255 | 2 |
| Average | 1.6 | 589 | 0.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 1.6 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $1 million in NVCN’s case. Sigma Labs, Inc. (NASDAQ:SGLB) is the most popular stock in this table. On the other hand Ossen Innovation Co Ltd (NASDAQ:OSN) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Neovasc Inc. (NASDAQ:NVCN) is more popular among hedge funds. Our overall hedge fund sentiment score for NVCN is 78.4. 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 gained 17.4% in 2021 through June 18th and still beat the market by 6.1 percentage points. Unfortunately NVCN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on NVCN were disappointed as the stock returned -13% since the end of the first quarter (through 6/18) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
