Hedge funds sell Gossamer Bio, Inc. (GOSS)
An impressive number of 13F files filed with the United States Securities and Exchange Commission have been processed by Insider Monkey so that individual investors can examine the general sentiment of hedge funds towards the stocks included in their watch lists. These recently submitted public documents disclose the fund managers’ equity positions at the end of the three-month period that ended on March 31, so let’s move on to the discussion of hedge fund sentiment on Gossamer Bio, Inc. ( NASDAQ:GOSS).
Gossamer Bio, Inc. (NASDAQ:GOSS) was listed in 19 hedge fund portfolios at the end of the first quarter of 2021. The all-time high for this statistic is 21. GOSS recently experienced a drop in hedge fund sentiment. There were 20 hedge funds in our database with GOSS positions at the end of the fourth quarter. Our calculations also showed that GOSS is not one of the 30 most popular stocks among hedge funds (click for Q1 ranking).
Why are we paying the least attention to hedge fund sentiment? Our research has shown that a select group of hedge funds have outperformed S&P 500 ETFs by 115 percentage points since March 2017 (see details here). This is why we believe that hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Michael Castor of Sio Capital
At Insider Monkey, we scour multiple sources to uncover the next big investing idea. For example, Chuck Schumer recently said legalizing marijuana would be a Senate priority. So we check this under the radar stock who will benefit. We go through lists like the 10 best stocks of batteries to choose the next Tesla which will offer a 10x return. Even though we only recommend positions in a tiny fraction of the companies we analyze, we check as many stocks as possible. We read letters from hedge fund investors and listen to market arguments at hedge fund conferences. You can subscribe to our free daily newsletter at our home page. Now let’s take a look at the key hedge fund action around Gossamer Bio, Inc. (NASDAQ:GOSS).
Do hedge funds think GOSS is a good stock to buy now?
At the end of March, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -5% from the fourth quarter of 2020. In contrast, there were a total of 10 hedge funds. with a bullish position on GOSS a year ago. So let’s see which hedge funds were among the top stock holders and which hedge funds were making big moves.
The largest stake in Gossamer Bio, Inc. (NASDAQ: GOSS) was held by Hillhouse Capital Management, who said he held shares worth $ 68.6 million at the end of December. It was followed by Palo Alto Investors with a position of $ 16.4 million. Other bullish investors for the company included Octagon Capital Advisors, Ikarian Capital and Cormorant Asset Management. In terms of portfolio weights assigned to each position Octagon Capital Advisors assigned the largest weighting to Gossamer Bio, Inc. (NASDAQ: GOSS), approximately 4.92% of its 13F portfolio. Parkman Healthcare Partners is also relatively very bullish on the stock, setting aside 1.25% of its 13F equity portfolio to GOSS.
Given that Gossamer Bio, Inc. (NASDAQ: GOSS) has been facing bearish sentiment from all of the hedge funds we track, it’s easy to see that there are a few select funds that have decided to fully sell their positions by the end of the first quarter. At the top of the heap, that of Oleg Nodelman Capital EcoR1 cut the biggest position of all hedges monitored by Insider Monkey, worth nearly $ 27.2 million in stocks. The Julian Baker and Felix Baker fonds, Baker Bros. Advisors, also dropped its shares, valued at around $ 4.6 million. These movements are important to note, as the total hedge fund interest was reduced by 1 fund at the end of the first quarter.
Let’s also look at hedge fund activity in other stocks – not necessarily in the same industry as Gossamer Bio, Inc. (NASDAQ: GOSS) but of similar value. We’ll take a look at Ethan Allen Interiors Inc. (NYSE:ETH), Qutoutiao Inc. (NASDAQ:QTT), Tian Ruixiang Holdings Ltd (NASDAQ:TIRX), The ExOne Company (NASDAQ:XONE), Heidrick & Struggles International, Inc. (NASDAQ:HSII), Bright Scholar Education Holdings Limited (NYSE:BEDU) and Winmark Corporation (NASDAQ:WINA). The market valuations of this group of stocks resemble the market valuation of GOSS.
[table] Ticker, number of HF with positions, total value of HF positions (x1000), change of HF position ETH, 13 45423, -1 QTT, 4,2833,1 TIRX, 1,763,1 XONE, 8,110929, -2 HSII, 17 111444.5 BEDU, 7.65735.1 WINA, 10.86703, -1 Average, 8.6.60547.0.6 [/table]
See the table here if you have formatting problems.
As you can see, these stocks had an average of 8.6 hedge funds with bullish positions and the average amount invested in these stocks was $ 61 million. That figure was $ 158 million in the case of GOSS. Heidrick & Struggles International, Inc. (NASDAQ:HSII) is the most popular action in this table. On the other hand, Tian Ruixiang Holdings Ltd (NASDAQ:TIRX) is the least popular with only 1 bullish hedge fund positions. Compared to these stocks, Gossamer Bio, Inc. (NASDAQ: GOSS) is more popular among hedge funds. Our overall hedge fund sentiment score for GOSS is 81.1. Stocks with a 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 have shown 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 23.8% in 2021 through July 16 and have consistently beaten the market by 7.7 percentage points. Unfortunately, GOSS was not as popular as these 5 stocks and the hedge funds betting on GOSS were disappointed as the stock has returned -21% since the end of the first quarter (through 7/16) and has under -performed the market. If you want to invest 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 have already outperformed the market since 2019.
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Disclosure: none. This article originally appeared on Monkey initiate.