Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the first quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Gamida Cell Ltd. (NASDAQ:GMDA) based on that data.
Hedge fund interest in Gamida Cell Ltd. (NASDAQ:GMDA) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare GMDA to other stocks including CB Financial Services, Inc. (NASDAQ:CBFV), Union Bankshares, Inc. (NASDAQ:UNB), and CymaBay Therapeutics Inc (NASDAQ:CBAY) to get a better sense of its popularity. Video: Watch our video about the top 5 most popular hedge fund stocks.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 58 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 36% through May 18th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
[caption id="attachment_758434" align="aligncenter" width="400"] Nathan Fischel of DAFNA Capital Management[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let's check out the recent hedge fund action encompassing Gamida Cell Ltd. (NASDAQ:GMDA).
How are hedge funds trading Gamida Cell Ltd. (NASDAQ:GMDA)?
At the end of the first quarter, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards GMDA over the last 18 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Gamida Cell Ltd. (NASDAQ:GMDA) was held by Rock Springs Capital Management, which reported holding $3 million worth of stock at the end of September. It was followed by Biotechnology Value Fund / BVF Inc with a $3 million position. Other investors bullish on the company included Alyeska Investment Group, DAFNA Capital Management, and Millennium Management. In terms of the portfolio weights assigned to each position Biotechnology Value Fund / BVF Inc allocated the biggest weight to Gamida Cell Ltd. (NASDAQ:GMDA), around 0.28% of its 13F portfolio. DAFNA Capital Management is also relatively very bullish on the stock, setting aside 0.19 percent of its 13F equity portfolio to GMDA.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren't any hedge funds dumping their holdings during the first quarter, there weren't any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven't identified any viable catalysts that can attract investor attention.
Let's go over hedge fund activity in other stocks similar to Gamida Cell Ltd. (NASDAQ:GMDA). These stocks are CB Financial Services, Inc. (NASDAQ:CBFV), Union Bankshares, Inc. (NASDAQ:UNB), CymaBay Therapeutics Inc (NASDAQ:CBAY), and Cidara Therapeutics Inc (NASDAQ:CDTX). All of these stocks' market caps are similar to GMDA's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CBFV,4,2765,-2 UNB,1,547,0 CBAY,14,41611,-5 CDTX,10,21826,1 Average,7.25,16687,-1.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 7.25 hedge funds with bullish positions and the average amount invested in these stocks was $17 million. That figure was $7 million in GMDA's case. CymaBay Therapeutics Inc (NASDAQ:CBAY) is the most popular stock in this table. On the other hand Union Bankshares, Inc. (NASDAQ:UNB) is the least popular one with only 1 bullish hedge fund positions. Gamida Cell Ltd. (NASDAQ:GMDA) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. A small number of hedge funds were also right about betting on GMDA as the stock returned 86.4% during the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.