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Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors' consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM).
Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM) was in 8 hedge funds' portfolios at the end of the first quarter of 2020. MIRM has experienced an increase in support from the world's most elite money managers lately. There were 7 hedge funds in our database with MIRM positions at the end of the previous quarter. Our calculations also showed that MIRM 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.
To most shareholders, hedge funds are seen as slow, old investment vehicles of the past. While there are more than 8000 funds in operation at the moment, Our researchers choose to focus on the moguls of this club, about 850 funds. These investment experts preside over most of the hedge fund industry's total capital, and by monitoring their finest equity investments, Insider Monkey has found numerous investment strategies that have historically defeated the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
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Kris Jenner of Rock Springs Capital Management[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we're going to take a glance at the recent hedge fund action regarding Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM).
How have hedgies been trading Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM)?
At the end of the first quarter, a total of 8 of the hedge funds tracked by Insider Monkey were long this stock, a change of 14% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards MIRM over the last 18 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Frazier Healthcare Partners held the most valuable stake in Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM), which was worth $49.9 million at the end of the third quarter. On the second spot was Deerfield Management which amassed $48.3 million worth of shares. Rock Springs Capital Management, Polar Capital, and Baker Bros. Advisors were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Frazier Healthcare Partners allocated the biggest weight to Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM), around 5.66% of its 13F portfolio. Deerfield Management is also relatively very bullish on the stock, earmarking 1.53 percent of its 13F equity portfolio to MIRM.
As one would reasonably expect, some big names were leading the bulls' herd. Polar Capital, managed by Brian Ashford-Russell and Tim Woolley, initiated the largest position in Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM). Polar Capital had $10.8 million invested in the company at the end of the quarter. Michael Castor's Sio Capital also made a $0.2 million investment in the stock during the quarter.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM) but similarly valued. We will take a look at NeoPhotonics Corp (NYSE:NPTN), Resources Connection, Inc. (NASDAQ:RECN), Village Super Market, Inc. (NASDAQ:VLGEA), and Adaptimmune Therapeutics plc (NASDAQ:ADAP). All of these stocks' market caps match MIRM's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NPTN,24,68849,5 RECN,10,39658,-2 VLGEA,7,22483,-3 ADAP,11,163151,2 Average,13,73535,0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $74 million. That figure was $138 million in MIRM's case. NeoPhotonics Corp (NYSE:NPTN) is the most popular stock in this table. On the other hand Village Super Market, Inc. (NASDAQ:VLGEA) is the least popular one with only 7 bullish hedge fund positions. Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM) 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 12.2% in 2020 through June 17th and still beat the market by 14.8 percentage points. A small number of hedge funds were also right about betting on MIRM as the stock returned 33.6% during the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.