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 Corcept Therapeutics Incorporated (NASDAQ:CORT) based on that data.
Corcept Therapeutics Incorporated (NASDAQ:CORT) shares haven't seen a lot of action during the first quarter. Overall, hedge fund sentiment was unchanged. The stock was in 21 hedge funds' portfolios at the end of March. At the end of this article we will also compare CORT to other stocks including Hilton Grand Vacations Inc. (NYSE:HGV), Glaukos Corporation (NYSE:GKOS), and InVitae Corporation (NYSE:NVTA) 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_845793" align="aligncenter" width="399"] Peter Rathjens of Arrowstreet Capital[/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 trades like this one. 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 take a peek at the recent hedge fund action encompassing Corcept Therapeutics Incorporated (NASDAQ:CORT).
How are hedge funds trading Corcept Therapeutics Incorporated (NASDAQ:CORT)?
Heading into the second quarter of 2020, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the fourth quarter of 2019. By comparison, 18 hedge funds held shares or bullish call options in CORT a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
The largest stake in Corcept Therapeutics Incorporated (NASDAQ:CORT) was held by Renaissance Technologies, which reported holding $98.7 million worth of stock at the end of September. It was followed by Arrowstreet Capital with a $14.1 million position. Other investors bullish on the company included GLG Partners, Winton Capital Management, and Marshall Wace LLP. In terms of the portfolio weights assigned to each position Zebra Capital Management allocated the biggest weight to Corcept Therapeutics Incorporated (NASDAQ:CORT), around 0.72% of its 13F portfolio. Birchview Capital is also relatively very bullish on the stock, designating 0.53 percent of its 13F equity portfolio to CORT.
Due to the fact that Corcept Therapeutics Incorporated (NASDAQ:CORT) has witnessed bearish sentiment from hedge fund managers, we can see that there exists a select few hedge funds that elected to cut their full holdings in the first quarter. Interestingly, Dmitry Balyasny's Balyasny Asset Management sold off the largest position of the 750 funds watched by Insider Monkey, comprising an estimated $0.7 million in stock. Michael Gelband's fund, ExodusPoint Capital, also dropped its stock, about $0.4 million worth. These transactions are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let's now review hedge fund activity in other stocks similar to Corcept Therapeutics Incorporated (NASDAQ:CORT). We will take a look at Hilton Grand Vacations Inc. (NYSE:HGV), Glaukos Corporation (NYSE:GKOS), InVitae Corporation (NYSE:NVTA), and 2U Inc (NASDAQ:TWOU). All of these stocks' market caps match CORT's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position HGV,29,512572,-17 GKOS,15,83596,-1 NVTA,10,225622,-3 TWOU,14,157558,-4 Average,17,244837,-6.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $245 million. That figure was $160 million in CORT's case. Hilton Grand Vacations Inc. (NYSE:HGV) is the most popular stock in this table. On the other hand InVitae Corporation (NYSE:NVTA) is the least popular one with only 10 bullish hedge fund positions. Corcept Therapeutics Incorporated (NASDAQ:CORT) is not the most popular stock in this group but hedge fund interest is still above 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 but still beat the market by 14.8 percentage points. Hedge funds were also right about betting on CORT as the stock returned 32.4% in Q2 (through June 17th) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.