After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of March 31. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Senseonics Holdings, Inc. (NYSEAMEX:SENS).
Is Senseonics Holdings, Inc. (NYSEAMEX:SENS) an exceptional investment now? Prominent investors are turning less bullish. The number of bullish hedge fund bets retreated by 4 in recent months. Our calculations also showed that SENS 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 40 percentage points since May 2014 through May 30, 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 30.9% through May 30, 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 gander at the recent hedge fund action surrounding Senseonics Holdings, Inc. (NYSEAMEX:SENS).
How have hedgies been trading Senseonics Holdings, Inc. (NYSEAMEX:SENS)?
At the end of the first quarter, a total of 10 of the hedge funds tracked by Insider Monkey were long this stock, a change of -29% from the fourth quarter of 2018. On the other hand, there were a total of 4 hedge funds with a bullish position in SENS a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey's hedge fund database, Michael Castor's Sio Capital has the largest position in Senseonics Holdings, Inc. (NYSEAMEX:SENS), worth close to $1.4 million, corresponding to 0.4% of its total 13F portfolio. The second largest stake is held by Endurant Capital Management, led by Vishal Saluja and Pham Quang, holding a $1.1 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions comprise Ken Griffin's Citadel Investment Group, Sander Gerber's Hudson Bay Capital Management and Charles Davidson and Joseph Jacobs's Wexford Capital.
Since Senseonics Holdings, Inc. (NYSEAMEX:SENS) has witnessed declining sentiment from the smart money, it's easy to see that there lies a certain "tier" of money managers that slashed their full holdings heading into Q3. Interestingly, Phil Frohlich's Prescott Group Capital Management dropped the biggest position of all the hedgies monitored by Insider Monkey, valued at an estimated $1.4 million in stock, and Steve Cohen's Point72 Asset Management was right behind this move, as the fund sold off about $1.3 million worth. These transactions are important to note, as total hedge fund interest dropped by 4 funds heading into Q3.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Senseonics Holdings, Inc. (NYSEAMEX:SENS) but similarly valued. We will take a look at Silvercorp Metals Inc. (NYSEAMEX:SVM), U.S. Lime & Minerals Inc. (NASDAQ:USLM), Financial Institutions, Inc. (NASDAQ:FISI), and Tower International Inc (NYSE:TOWR). All of these stocks' market caps are closest to SENS's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SVM,9,17911,-3 USLM,4,31382,2 FISI,11,39671,1 TOWR,13,41821,-3 Average,9.25,32696,-0.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $33 million. That figure was $5 million in SENS's case. Tower International Inc (NYSE:TOWR) is the most popular stock in this table. On the other hand U.S. Lime & Minerals Inc. (NASDAQ:USLM) is the least popular one with only 4 bullish hedge fund positions. Senseonics Holdings, Inc. (NYSEAMEX:SENS) 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 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately SENS wasn't nearly as popular as these 20 stocks and hedge funds that were betting on SENS were disappointed as the stock returned -15.9% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.