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Is SI-BONE, Inc. (SIBN) A Good Stock To Buy?

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In this article we will check out the progression of hedge fund sentiment towards SI-BONE, Inc. (NASDAQ:SIBN) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.

SI-BONE, Inc. (NASDAQ:SIBN) has experienced an increase in hedge fund sentiment in recent months. SI-BONE, Inc. (NASDAQ:SIBN) was in 28 hedge funds' portfolios at the end of the second quarter of 2021. The all time high for this statistic is 30. Our calculations also showed that SIBN isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).

In today’s marketplace there are a multitude of tools stock traders use to value stocks. A duo of the less known tools are hedge fund and insider trading moves. We have shown that, historically, those who follow the best picks of the top fund managers can beat the market by a healthy amount (see the details here). Also, our monthly newsletter's portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.

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At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV 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 take a glance at the fresh hedge fund action regarding SI-BONE, Inc. (NASDAQ:SIBN).

Do Hedge Funds Think SIBN Is A Good Stock To Buy Now?

Heading into the third quarter of 2021, a total of 28 of the hedge funds tracked by Insider Monkey were long this stock, a change of 8% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards SIBN over the last 24 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is SIBN A Good Stock To Buy?
Is SIBN A Good Stock To Buy?

Among these funds, OrbiMed Advisors held the most valuable stake in SI-BONE, Inc. (NASDAQ:SIBN), which was worth $41.1 million at the end of the second quarter. On the second spot was Driehaus Capital which amassed $31.1 million worth of shares. Holocene Advisors, Armistice Capital, and Millennium Management 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 Tamarack Capital Management allocated the biggest weight to SI-BONE, Inc. (NASDAQ:SIBN), around 2.27% of its 13F portfolio. G2 Investment Partners Management is also relatively very bullish on the stock, setting aside 0.95 percent of its 13F equity portfolio to SIBN.

Now, some big names have jumped into SI-BONE, Inc. (NASDAQ:SIBN) headfirst. Integral Health Asset Management, managed by Bhagwan Jay Rao, initiated the most outsized position in SI-BONE, Inc. (NASDAQ:SIBN). Integral Health Asset Management had $5.7 million invested in the company at the end of the quarter. Paul Tudor Jones's Tudor Investment Corp also made a $1.4 million investment in the stock during the quarter. The other funds with new positions in the stock are Vishal Saluja and Pham Quang's Endurant Capital Management, Ray Dalio's Bridgewater Associates, and Gavin Saitowitz and Cisco J. del Valle's Prelude Capital (previously Springbok Capital).

Let's now review hedge fund activity in other stocks - not necessarily in the same industry as SI-BONE, Inc. (NASDAQ:SIBN) but similarly valued. We will take a look at So-Young International Inc. (NASDAQ:SY), Fortuna Silver Mines Inc. (NYSE:FSM), OneSpan Inc. (NASDAQ:OSPN), Endeavour Silver Corp. (NYSE:EXK), Forestar Group Inc. (NYSE:FOR), Humanigen, Inc. (NASDAQ:HGEN), and NexTier Oilfield Solutions Inc. (NYSE:NEX). This group of stocks' market valuations match SIBN's market valuation.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SY,5,14330,-1 FSM,14,21601,2 OSPN,10,156729,-5 EXK,8,6435,-2 FOR,14,124439,0 HGEN,11,181435,0 NEX,24,270489,1 Average,12.3,110780,-0.7 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 12.3 hedge funds with bullish positions and the average amount invested in these stocks was $111 million. That figure was $202 million in SIBN's case. NexTier Oilfield Solutions Inc. (NYSE:NEX) is the most popular stock in this table. On the other hand So-Young International Inc. (NASDAQ:SY) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks SI-BONE, Inc. (NASDAQ:SIBN) is more popular among hedge funds. Our overall hedge fund sentiment score for SIBN is 85. 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. 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 24.9% in 2021 through October 15th and still beat the market by 4.5 percentage points. Unfortunately SIBN wasn't nearly as popular as these 5 stocks and hedge funds that were betting on SIBN were disappointed as the stock returned -27.4% since the end of the second quarter (through 10/15) 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 since 2019.

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Disclosure: None. This article was originally published at Insider Monkey.