Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR) the right pick for your portfolio? Prominent investors were selling. The number of bullish hedge fund positions decreased by 6 lately. Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR) was in 24 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 30. Our calculations also showed that ARWR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 30 hedge funds in our database with ARWR holdings at the end of June.
Peter Algert of Algert Global
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV 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. Keeping this in mind we’re going to take a look at the recent hedge fund action surrounding Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR).
Do Hedge Funds Think ARWR Is A Good Stock To Buy Now?
At Q3’s end, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, a change of -20% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards ARWR over the last 25 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR) was held by Farallon Capital, which reported holding $49.7 million worth of stock at the end of September. It was followed by Aquilo Capital Management with a $33 million position. Other investors bullish on the company included Citadel Investment Group, Point72 Asset Management, and Adage Capital Management. In terms of the portfolio weights assigned to each position Aquilo Capital Management allocated the biggest weight to Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR), around 5.99% of its 13F portfolio. Acuta Capital Partners is also relatively very bullish on the stock, setting aside 2.68 percent of its 13F equity portfolio to ARWR.
Because Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR) has witnessed falling interest from the smart money, it’s easy to see that there exists a select few hedgies that slashed their full holdings last quarter. Intriguingly, Joseph Edelman’s Perceptive Advisors said goodbye to the biggest investment of all the hedgies tracked by Insider Monkey, worth about $26.1 million in stock. Paul Marshall and Ian Wace’s fund, Marshall Wace LLP, also cut its stock, about $20.7 million worth. These moves are interesting, as aggregate hedge fund interest fell by 6 funds last quarter.
Let’s now review hedge fund activity in other stocks similar to Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR). These stocks are Virgin Galactic Holdings, Inc. (NYSE:SPCE), Varonis Systems Inc (NASDAQ:VRNS), First Financial Bankshares Inc (NASDAQ:FFIN), Healthcare Trust Of America Inc (NYSE:HTA), Mattel, Inc. (NASDAQ:MAT), TaskUs Inc. (NASDAQ:TASK), and Omnicell, Inc. (NASDAQ:OMCL). This group of stocks’ market caps are similar to ARWR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SPCE | 16 | 105669 | -2 |
| VRNS | 27 | 298396 | 3 |
| FFIN | 20 | 81284 | 12 |
| HTA | 14 | 381781 | -9 |
| MAT | 34 | 1030578 | 9 |
| TASK | 18 | 230676 | -2 |
| OMCL | 20 | 110091 | 2 |
| Average | 21.3 | 319782 | 1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.3 hedge funds with bullish positions and the average amount invested in these stocks was $320 million. That figure was $151 million in ARWR’s case. Mattel, Inc. (NASDAQ:MAT) is the most popular stock in this table. On the other hand Healthcare Trust Of America Inc (NYSE:HTA) is the least popular one with only 14 bullish hedge fund positions. Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for ARWR is 48. 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. Hedge funds were also right about betting on ARWR as the stock returned 13.5% since the end of Q3 (through 12/9) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR)
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Disclosure: None. This article was originally published at Insider Monkey.
