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Did Hedge Funds Drop The Ball On ANI Pharmaceuticals Inc (ANIP) ?

Reymerlyn Martin

Is ANI Pharmaceuticals Inc (NASDAQ:ANIP) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It's not surprising given that hedge funds have access to better information and more resources to find the winners in the stock market.

ANI Pharmaceuticals Inc (NASDAQ:ANIP) was in 13 hedge funds' portfolios at the end of the fourth quarter of 2018. ANIP has experienced a decrease in activity from the world's largest hedge funds of late. There were 17 hedge funds in our database with ANIP positions at the end of the previous quarter. Our calculations also showed that ANIP isn't among the 30 most popular stocks among hedge funds.

To most traders, hedge funds are viewed as slow, outdated financial tools of the past. While there are over 8000 funds trading at present, We hone in on the elite of this club, about 750 funds. These investment experts direct most of the smart money's total asset base, and by monitoring their top investments, Insider Monkey has come up with numerous investment strategies that have historically beaten the S&P 500 index. Insider Monkey's flagship hedge fund strategy exceeded the S&P 500 index by nearly 5 percentage points a year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 27.5% since February 2017 (through March 12th) even though the market was up nearly 25% during the same period. We just shared a list of 6 short targets in our latest quarterly update and they are already down an average of 6% in less than a month.

Nathaniel August - Mangrove Partners

We're going to analyze the new hedge fund action regarding ANI Pharmaceuticals Inc (NASDAQ:ANIP).

What does the smart money think about ANI Pharmaceuticals Inc (NASDAQ:ANIP)?

Heading into the first quarter of 2019, a total of 13 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -24% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards ANIP over the last 14 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

ANIP_may2019

Among these funds, Mangrove Partners held the most valuable stake in ANI Pharmaceuticals Inc (NASDAQ:ANIP), which was worth $24.7 million at the end of the fourth quarter. On the second spot was Renaissance Technologies which amassed $7.6 million worth of shares. Moreover, Consonance Capital Management, Weiss Asset Management, and Millennium Management were also bullish on ANI Pharmaceuticals Inc (NASDAQ:ANIP), allocating a large percentage of their portfolios to this stock.

Because ANI Pharmaceuticals Inc (NASDAQ:ANIP) has faced bearish sentiment from the entirety of the hedge funds we track, we can see that there lies a certain "tier" of funds who were dropping their full holdings heading into Q3. Intriguingly, Miguel Fidalgo's Triarii Capital dropped the biggest position of the 700 funds watched by Insider Monkey, valued at about $3.7 million in stock. Joel Greenblatt's fund, Gotham Asset Management, also said goodbye to its stock, about $0.8 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 4 funds heading into Q3.

Let's now take a look at hedge fund activity in other stocks similar to ANI Pharmaceuticals Inc (NASDAQ:ANIP). We will take a look at Community Healthcare Trust Inc (NYSE:CHCT), Myers Industries, Inc. (NYSE:MYE), Controladora Vuela Co Avcn SA CV (NYSE:VLRS), and Century Communities, Inc (NYSE:CCS). All of these stocks' market caps resemble ANIP's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CHCT,9,63252,0 MYE,8,84723,0 VLRS,7,48641,2 CCS,15,137521,-7 Average,9.75,83534,-1.25 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.75 hedge funds with bullish positions and the average amount invested in these stocks was $84 million. That figure was $47 million in ANIP's case. Century Communities, Inc (NYSE:CCS) is the most popular stock in this table. On the other hand Controladora Vuela Co Avcn SA CV (NYSE:VLRS) is the least popular one with only 7 bullish hedge fund positions. ANI Pharmaceuticals Inc (NASDAQ:ANIP) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Hedge funds were also right about betting on ANIP as the stock returned 52.8% and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.

Disclosure: None. This article was originally published at Insider Monkey.

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