At the end of February we announced the arrival of the first US recession since 2009 and we predicted that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards BioNTech SE (NASDAQ:BNTX).
BioNTech SE (NASDAQ:BNTX) investors should be aware of an increase in activity from the world's largest hedge funds of late. Our calculations also showed that BNTX isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). Video: Watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are numerous signals investors put to use to assess their stock investments. A pair of the most useful signals are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the best picks of the top investment managers can outpace the S&P 500 by a very impressive margin (see the details here).
[caption id="attachment_339612" align="aligncenter" width="392"] Kerr Neilson of Platinum Asset 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. Keeping this in mind let's review the latest hedge fund action regarding BioNTech SE (NASDAQ:BNTX).
Hedge fund activity in BioNTech SE (NASDAQ:BNTX)
At Q1's end, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of 50% from the fourth quarter of 2019. The graph below displays the number of hedge funds with bullish position in BNTX over the last 18 quarters. With hedgies' positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Kerr Neilson's Platinum Asset Management has the biggest position in BioNTech SE (NASDAQ:BNTX), worth close to $24.9 million, amounting to 0.6% of its total 13F portfolio. Sitting at the No. 2 spot is Jeremy Green of Redmile Group, with a $9.9 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions comprise Benjamin A. Smith's Laurion Capital Management, Sander Gerber's Hudson Bay Capital Management and Israel Englander's Millennium Management. In terms of the portfolio weights assigned to each position Platinum Asset Management allocated the biggest weight to BioNTech SE (NASDAQ:BNTX), around 0.63% of its 13F portfolio. Redmile Group is also relatively very bullish on the stock, designating 0.28 percent of its 13F equity portfolio to BNTX.
Consequently, key hedge funds have been driving this bullishness. Hudson Bay Capital Management, managed by Sander Gerber, created the most valuable position in BioNTech SE (NASDAQ:BNTX). Hudson Bay Capital Management had $1.2 million invested in the company at the end of the quarter. Donald Sussman's Paloma Partners also made a $0.3 million investment in the stock during the quarter.
Let's go over hedge fund activity in other stocks similar to BioNTech SE (NASDAQ:BNTX). These stocks are Maxim Integrated Products Inc. (NASDAQ:MXIM), CGI Inc. (NYSE:GIB), Cheniere Energy Partners LP (NYSE:CQP), and iQIYI, Inc. (NASDAQ:IQ). This group of stocks' market values resemble BNTX's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position MXIM,30,213575,-2 GIB,18,246597,-1 CQP,3,814865,-4 IQ,28,983179,10 Average,19.75,564554,0.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.75 hedge funds with bullish positions and the average amount invested in these stocks was $565 million. That figure was $38 million in BNTX's case. Maxim Integrated Products Inc. (NASDAQ:MXIM) is the most popular stock in this table. On the other hand Cheniere Energy Partners LP (NYSE:CQP) is the least popular one with only 3 bullish hedge fund positions. BioNTech SE (NASDAQ:BNTX) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. 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 13.9% in 2020 through June 10th and surpassed the market by 14.2 percentage points. Unfortunately BNTX wasn't nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); BNTX investors were disappointed as the stock returned -18.8% during the second 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 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.