Is LFVN Stock A Buy Here?
With the first-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the second quarter of 2021. One of these stocks was Lifevantage Corporation (NASDAQ:LFVN).
Is LFVN stock a buy? Lifevantage Corporation (NASDAQ:LFVN) was in 5 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 12. LFVN shareholders have witnessed a decrease in hedge fund interest lately. There were 8 hedge funds in our database with LFVN holdings at the end of December. Our calculations also showed that LFVN isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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. Hedge funds have more than $3.5 trillion in assets under management, so you can't expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds' moves today.
Peter Algert of Algert Global
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund owns nearly 40% of this $23 biotech stock and is trying to buy the rest for around $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now we're going to check out the key hedge fund action regarding Lifevantage Corporation (NASDAQ:LFVN).
Do Hedge Funds Think LFVN Is A Good Stock To Buy Now?
At Q1's end, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, a change of -38% from the fourth quarter of 2020. On the other hand, there were a total of 8 hedge funds with a bullish position in LFVN a year ago. With hedge funds' sentiment swirling, there exists an "upper tier" of notable hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).
The largest stake in Lifevantage Corporation (NASDAQ:LFVN) was held by Renaissance Technologies, which reported holding $11.3 million worth of stock at the end of December. It was followed by Citadel Investment Group with a $0.4 million position. Other investors bullish on the company included Engineers Gate Manager, PDT Partners, and Algert Global. In terms of the portfolio weights assigned to each position Algert Global allocated the biggest weight to Lifevantage Corporation (NASDAQ:LFVN), around 0.04% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, setting aside 0.01 percent of its 13F equity portfolio to LFVN.
Since Lifevantage Corporation (NASDAQ:LFVN) has experienced falling interest from the entirety of the hedge funds we track, it's safe to say that there exists a select few hedgies who sold off their entire stakes by the end of the first quarter. At the top of the heap, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital sold off the biggest investment of all the hedgies monitored by Insider Monkey, worth about $0.9 million in stock. David Harding's fund, Winton Capital Management, also dumped its stock, about $0.3 million worth. These moves are important to note, as total hedge fund interest was cut by 3 funds by the end of the first quarter.
Let's now take a look at hedge fund activity in other stocks similar to Lifevantage Corporation (NASDAQ:LFVN). We will take a look at Odonate Therapeutics, Inc. (NASDAQ:ODT), Saga Communications, Inc. (NASDAQ:SGA), Aravive, Inc. (NASDAQ:ARAV), Twin Disc, Incorporated (NASDAQ:TWIN), Partners Bancorp (NASDAQ:PTRS), MMA Capital Holdings Inc. (NASDAQ:MMAC), and Code Chain New Continent Limited (NASDAQ:CCNC). This group of stocks' market values match LFVN's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ODT,12,69260,-6 SGA,3,11062,0 ARAV,6,3665,0 TWIN,5,25838,0 PTRS,2,993,1 MMAC,4,8482,-1 CCNC,3,657,3 Average,5,17137,-0.4 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 5 hedge funds with bullish positions and the average amount invested in these stocks was $17 million. That figure was $12 million in LFVN's case. Odonate Therapeutics, Inc. (NASDAQ:ODT) is the most popular stock in this table. On the other hand Partners Bancorp (NASDAQ:PTRS) is the least popular one with only 2 bullish hedge fund positions. Lifevantage Corporation (NASDAQ:LFVN) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for LFVN is 29.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.4% in 2021 through June 18th and surpassed the market again by 6.1 percentage points. Unfortunately LFVN wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); LFVN investors were disappointed as the stock returned -20.9% since the end of March (through 6/18) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.
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Disclosure: None. This article was originally published at Insider Monkey.
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