In this article we will analyze whether C4 Therapeutics, Inc. (NASDAQ:CCCC) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There's no better way to get these firms' immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market by double digits annually.
Is CCCC a good stock to buy? C4 Therapeutics, Inc. (NASDAQ:CCCC) has seen a decrease in activity from the world's largest hedge funds of late. C4 Therapeutics, Inc. (NASDAQ:CCCC) was in 21 hedge funds' portfolios at the end of September. The all time high for this statistic is 23. There were 23 hedge funds in our database with CCCC positions at the end of the second quarter. Our calculations also showed that CCCC isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so 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. Keeping this in mind let's take a look at the latest hedge fund action encompassing C4 Therapeutics, Inc. (NASDAQ:CCCC).
Robert Atchinson of Adage Capital Management
Do Hedge Funds Think CCCC Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -9% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards CCCC over the last 25 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Perceptive Advisors was the largest shareholder of C4 Therapeutics, Inc. (NASDAQ:CCCC), with a stake worth $100.9 million reported as of the end of September. Trailing Perceptive Advisors was RA Capital Management, which amassed a stake valued at $61.6 million. Adage Capital Management, Soleus Capital, and Laurion Capital 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 Commodore Capital allocated the biggest weight to C4 Therapeutics, Inc. (NASDAQ:CCCC), around 5.67% of its 13F portfolio. Soleus Capital is also relatively very bullish on the stock, setting aside 5.23 percent of its 13F equity portfolio to CCCC.
Due to the fact that C4 Therapeutics, Inc. (NASDAQ:CCCC) has experienced declining sentiment from the aggregate hedge fund industry, we can see that there were a few hedgies that slashed their positions entirely by the end of the third quarter. Intriguingly, Bihua Chen's Cormorant Asset Management said goodbye to the largest position of all the hedgies watched by Insider Monkey, valued at about $13.4 million in stock, and Matthew L Pinz's Pinz Capital was right behind this move, as the fund cut about $6.2 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 2 funds by the end of the third quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as C4 Therapeutics, Inc. (NASDAQ:CCCC) but similarly valued. We will take a look at Nuvation Bio Inc. (NYSE:NUVB), Sandy Spring Bancorp Inc. (NASDAQ:SASR), Piedmont Office Realty Trust, Inc. (NYSE:PDM), Dutch Bros Inc. (NYSE:BROS), Golden Ocean Group Ltd (NASDAQ:GOGL), EVgo Inc. (NASDAQ:EVGO), and Progress Software Corporation (NASDAQ:PRGS). This group of stocks' market values are similar to CCCC's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NUVB,22,486120,-2 SASR,8,26906,-3 PDM,14,71151,1 BROS,18,92566,18 GOGL,13,105628,-2 EVGO,19,48025,19 PRGS,17,145018,1 Average,15.9,139345,4.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 15.9 hedge funds with bullish positions and the average amount invested in these stocks was $139 million. That figure was $391 million in CCCC's case. Nuvation Bio Inc. (NYSE:NUVB) is the most popular stock in this table. On the other hand Sandy Spring Bancorp Inc. (NASDAQ:SASR) is the least popular one with only 8 bullish hedge fund positions. C4 Therapeutics, Inc. (NASDAQ:CCCC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CCCC is 76.8. 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 positive signal but 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 29.6% in 2021 and beat the market again by 3.6 percentage points. Unfortunately CCCC wasn't nearly as popular as these 5 stocks and hedge funds that were betting on CCCC were disappointed as the stock returned -27.9% since the end of September (through 12/31) 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 many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.