Should I Avoid Curis, Inc. (CRIS)?

Is Curis, Inc. (NASDAQ:CRIS) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.

Curis, Inc. (NASDAQ:CRIS) investors should pay attention to a decrease in enthusiasm from smart money of late. Curis, Inc. (NASDAQ:CRIS) was in 21 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 29. There were 24 hedge funds in our database with CRIS holdings at the end of June. Our calculations also showed that CRIS isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

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. Now let’s take a glance at the latest hedge fund action encompassing Curis, Inc. (NASDAQ:CRIS).

Michael Castor of Sio Capital

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

At Q3’s end, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from the previous quarter. The graph below displays the number of hedge funds with bullish position in CRIS over the last 25 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Curis, Inc. (NASDAQ:CRIS) was held by Maverick Capital, which reported holding $59.3 million worth of stock at the end of September. It was followed by Adage Capital Management with a $30.5 million position. Other investors bullish on the company included OrbiMed Advisors, Polar Capital, and Sio Capital. In terms of the portfolio weights assigned to each position Sio Capital allocated the biggest weight to Curis, Inc. (NASDAQ:CRIS), around 7.27% of its 13F portfolio. Octagon Capital Advisors is also relatively very bullish on the stock, earmarking 4.42 percent of its 13F equity portfolio to CRIS.

Because Curis, Inc. (NASDAQ:CRIS) has faced falling interest from the aggregate hedge fund industry, it’s safe to say that there exists a select few funds that decided to sell off their positions entirely in the third quarter. Intriguingly, Peter Kolchinsky’s RA Capital Management dumped the largest stake of the 750 funds tracked by Insider Monkey, valued at about $57.6 million in stock. Doron Breen and Mori Arkin’s fund, Sphera Global Healthcare Fund, also cut its stock, about $4.7 million worth. These moves are important to note, as total hedge fund interest fell by 3 funds in the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Curis, Inc. (NASDAQ:CRIS) but similarly valued. We will take a look at Digi International Inc. (NASDAQ:DGII), Camden National Corporation (NASDAQ:CAC), Taysha Gene Therapies, Inc. (NASDAQ:TSHA), Oramed Pharmaceuticals Inc. (NASDAQ:ORMP), Village Farms International, Inc. (NASDAQ:VFF), Annexon, Inc. (NASDAQ:ANNX), and Gladstone Land Corporation (NASDAQ:LAND). This group of stocks’ market valuations resemble CRIS’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 7.4 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $245 million in CRIS’s case. Annexon, Inc. (NASDAQ:ANNX) is the most popular stock in this table. On the other hand Taysha Gene Therapies, Inc. (NASDAQ:TSHA) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Curis, Inc. (NASDAQ:CRIS) is more popular among hedge funds. Our overall hedge fund sentiment score for CRIS is 73.7. 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 29.6% in 2021 and still beat the market by 3.6 percentage points. Unfortunately CRIS wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on CRIS were disappointed as the stock returned -39.2% since the end of the third quarter (through 12/31) 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.