Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and investors' positions as of the end of the fourth quarter. You can find write-ups 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 and analyze what the smart money thinks of SIGA Technologies Inc. (NASDAQ:SIGA) based on that data.
Is SIGA Technologies Inc. (NASDAQ:SIGA) an excellent investment now? Investors who are in the know are becoming more confident. The number of bullish hedge fund bets improved by 1 in recent months. Our calculations also showed that SIGA isn't among the 30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (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 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to take a glance at the recent hedge fund action surrounding SIGA Technologies Inc. (NASDAQ:SIGA).
What have hedge funds been doing with SIGA Technologies Inc. (NASDAQ:SIGA)?
At Q4's end, a total of 10 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 11% from the second quarter of 2018. On the other hand, there were a total of 6 hedge funds with a bullish position in SIGA a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in SIGA Technologies Inc. (NASDAQ:SIGA) was held by Jet Capital Investors, which reported holding $24.1 million worth of stock at the end of December. It was followed by Nantahala Capital Management with a $18 million position. Other investors bullish on the company included Citadel Investment Group, Marshall Wace LLP, and Millennium Management.
As industrywide interest jumped, specific money managers were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the largest position in SIGA Technologies Inc. (NASDAQ:SIGA). Marshall Wace LLP had $0.5 million invested in the company at the end of the quarter. D. E. Shaw's D E Shaw also initiated a $0.1 million position during the quarter. The other funds with brand new SIGA positions are Joel Greenblatt's Gotham Asset Management, Peter Algert and Kevin Coldiron's Algert Coldiron Investors, and Ken Griffin's Citadel Investment Group.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as SIGA Technologies Inc. (NASDAQ:SIGA) but similarly valued. We will take a look at i3 Verticals, Inc. (NASDAQ:IIIV), Univest Corp. of PA (NASDAQ:UVSP), John B. Sanfilippo & Son, Inc. (NASDAQ:JBSS), and ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS). All of these stocks' market caps are similar to SIGA's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IIIV,8,78989,-4 UVSP,5,25481,-2 JBSS,10,93482,2 IMOS,1,24246,-1 Average,6,55550,-1.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 6 hedge funds with bullish positions and the average amount invested in these stocks was $56 million. That figure was $44 million in SIGA's case. John B. Sanfilippo & Son, Inc. (NASDAQ:JBSS) is the most popular stock in this table. On the other hand ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS) is the least popular one with only 1 bullish hedge fund positions. SIGA Technologies Inc. (NASDAQ:SIGA) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. 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. Unfortunately SIGA wasn't nearly as popular as these 15 stock and hedge funds that were betting on SIGA were disappointed as the stock returned -33.9% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.