Hedge funds have never been so bullish on I-Mab (IMAB)
As the market is dragged down by short-term sentiment influenced by the accommodating US interest rate environment, virus news and stimulus spending, many smart investors are starting to be cautious about the current uptrend since March 2020 and to hedge or reduce many of their long positions. Some fund managers bet on the Dow Jones reaching 40,000 to generate solid returns. However, as we know, large investors usually buy stocks with strong fundamentals that can generate gains in both bullish and bearish markets, which is why we believe we can profit from emulating them. In this article, we’ll take a look at the smart money sentiment surrounding I-Mab (NASDAQ:IMAB).
I-Mab (NASDAQ:IMAB) investors should pay attention to an increase in interest from hedge funds in recent months. I-Mab (NASDAQ:IMAB) appeared in 20 hedge fund portfolios at the end of March. The all-time high for this statistic is 14. This means the bullish number of hedge fund positions in this stock is currently at its all-time high. Our calculations have also shown that IMAB is not one of the 30 most popular stocks among hedge funds (click for Q1 ranking).
The reputation of hedge funds as savvy investors has been tarnished over the past decade, as their hedged returns could not keep up with the unhedged returns of stock indices. Hedge funds have over $ 3.5 trillion in assets under management, so you can’t expect all of their portfolios to beat the market with significant margins. Our research identified in advance a select group of hedge funds that have outperformed S&P 500 ETFs by more than 115 percentage points since March 2017 (see details here). So you can still find a lot of gems by following the movements of hedge funds today.
Lei Zhang of Hillhouse Capital Management
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Do hedge funds think IMAB is a good stock to buy now?
At the end of the first quarter, a total of 20 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 43% from the fourth quarter of 2020. By comparison, 4 hedge funds held stocks or options. bullish purchase in IMAB a year ago. With the evolution of hedge fund capital, there are a few key hedge fund managers who were significantly increasing their holdings (or already accumulating significant positions).
The largest stake in I-Mab (NASDAQ: IMAB) was held by Hillhouse Capital Management, which said it held shares worth $ 320.7 million at the end of December. It was followed by Adage Capital Management with a position of $ 59 million. Other bullish investors for the company included Octagon Capital Advisors, Indus Capital and Millennium Management. In terms of portfolio weights assigned to each position Octagon Capital Advisors assigned the greatest weight to I-Mab (NASDAQ: IMAB), around 9.68% of its 13F portfolio. Capital of the Indus is also relatively very bullish on the stock, designating 4.15% of its 13F equity portfolio to IMAB.
As interest from the entire industry grew, specific fund managers were themselves innovating. Capital Segantii, led by Simon Sadler, created the largest position in I-Mab (NASDAQ: IMAB). Segantii Capital had invested $ 9.7 million in the company at the end of the quarter. Josh Resnick’s Jericho Capital Asset Management also made a $ 7.2 million investment in the stock during the quarter. Other funds with brand new IMAB positions are CaaS Capital from Frank Fu, Schonfeld Strategic Advisors from Ryan Tolkin (CIO) and Quaero Capital from Philip Best.
Now let’s review the activity of hedge funds in other stocks similar to I-Mab (NASDAQ: IMAB). These stocks are 8×8, Inc. (NYSE:EIGHT), Vishay Intertechnology, Inc. (NYSE:VSH), EPR Properties (NYSE:REP), Sanderson Farms, Inc. (NASDAQ:SAFM), AMN Healthcare Services Inc (NYSE:AMN), TechnipFMC plc (NYSE:FTI) and Rush Street Interactive, Inc. (NYSE:RSI). The market capitalizations of this group of stocks resemble the market capitalization of IMAB.
[table] Ticker, number of HF with positions, total value of HF positions (x1000), change of HF position EGHT, 24.1006511, -2 VSH, 32.565142.1 EPR, 15.345162.0 SAFM, 18.177554, – 1 AMN, 19 82099.6 FTI, 25.409812, -10 RSI, 17.116342, -9 Medium, 21.4.386089, -2.1 [/table]
See the table here if you have formatting problems.
As you can see, these stocks had an average of 21.4 hedge funds with bullish positions and the average amount invested in these stocks was $ 386 million. That figure was $ 509 million in the case of IMAB. Vishay Intertechnology, Inc. (NYSE:VSH) is the most popular action in this table. On the other hand EPR Properties (NYSE:REP) is the least popular with only 15 bullish hedge fund positions. I-Mab (NASDAQ: IMAB) isn’t the least popular stock in this group, but hedge fund interest is still below average. Our overall hedge fund sentiment score for IMAB is 54.7. Stocks with a 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 have shown 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 23.8% in 2021 through July 16 and have consistently beaten the market by 7.7 percentage points. A small number of hedge funds were also right to bet on IMAB, as the stock has returned 59.8% since the end of the first quarter (through 7/16) and outperformed the market by an even larger margin.
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Disclosure: none. This article originally appeared on Monkey initiate.