Is Stemline Therapeutics Inc (NASDAQ:STML) 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.
Is Stemline Therapeutics Inc (NASDAQ:STML) a healthy stock for your portfolio? Hedge funds are taking a bullish view. The number of long hedge fund bets improved by 1 lately. Our calculations also showed that STML isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
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Phill Gross of Adage Capital Management
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds‘ buy/sell signals. We’re going to take a look at the recent hedge fund action regarding Stemline Therapeutics Inc (NASDAQ:STML).
How have hedgies been trading Stemline Therapeutics Inc (NASDAQ:STML)?
At Q3’s end, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 6% from one quarter earlier. On the other hand, there were a total of 17 hedge funds with a bullish position in STML a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Adage Capital Management was the largest shareholder of Stemline Therapeutics Inc (NASDAQ:STML), with a stake worth $45.8 million reported as of the end of September. Trailing Adage Capital Management was Rubric Capital Management, which amassed a stake valued at $26.9 million. Farallon Capital, Polar Capital, and Healthcor Management 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 Rubric Capital Management allocated the biggest weight to Stemline Therapeutics Inc (NASDAQ:STML), around 2.46% of its 13F portfolio. Clearline Capital is also relatively very bullish on the stock, dishing out 1.45 percent of its 13F equity portfolio to STML.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Laurion Capital Management, managed by Benjamin A. Smith, initiated the largest position in Stemline Therapeutics Inc (NASDAQ:STML). Laurion Capital Management had $1 million invested in the company at the end of the quarter. David Harding’s Winton Capital Management also initiated a $0.1 million position during the quarter. The only other fund with a new position in the stock is Paul Marshall and Ian Wace’s Marshall Wace.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Stemline Therapeutics Inc (NASDAQ:STML) but similarly valued. We will take a look at Aurora Mobile Limited (NASDAQ:JG), Landmark Infrastructure Partners LP (NASDAQ:LMRK), Milestone Pharmaceuticals Inc. (NASDAQ:MIST), and Personalis, Inc. (NASDAQ:PSNL). This group of stocks’ market caps are similar to STML’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| JG | 1 | 77 | 0 |
| LMRK | 3 | 2471 | -1 |
| MIST | 6 | 22541 | -1 |
| PSNL | 11 | 24511 | -6 |
| Average | 5.25 | 12400 | -2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.25 hedge funds with bullish positions and the average amount invested in these stocks was $12 million. That figure was $162 million in STML’s case. Personalis, Inc. (NASDAQ:PSNL) is the most popular stock in this table. On the other hand Aurora Mobile Limited (NASDAQ:JG) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Stemline Therapeutics Inc (NASDAQ:STML) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately STML wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on STML were disappointed as the stock returned 2.7% during the first two months of the fourth quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market in Q4.
Disclosure: None. This article was originally published at Insider Monkey.
