After several tireless days we have finished crunching the numbers from nearly 900 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 31st. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Synthetic Biologics Inc (NYSE:SYN).
Is Synthetic Biologics Inc (NYSE:SYN) worth your attention right now? Investors who are in the know were getting more optimistic. The number of long hedge fund positions advanced by 1 in recent months. Synthetic Biologics Inc (NYSE:SYN) was in 3 hedge funds' portfolios at the end of March. The all time high for this statistic is 9. Our calculations also showed that SYN 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.
Ken Fisher of Fisher Asset Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $26 biotech stock for $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. With all of this in mind we're going to take a look at the key hedge fund action encompassing Synthetic Biologics Inc (NYSE:SYN).
Do Hedge Funds Think SYN Is A Good Stock To Buy Now?
At Q1's end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 50% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards SYN over the last 23 quarters. With hedgies' sentiment swirling, there exists an "upper tier" of notable hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
Among these funds, MSDC Management held the most valuable stake in Synthetic Biologics Inc (NYSE:SYN), which was worth $0.7 million at the end of the fourth quarter. On the second spot was Citadel Investment Group which amassed $0.4 million worth of shares. Fisher Asset Management was 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 MSDC Management allocated the biggest weight to Synthetic Biologics Inc (NYSE:SYN), around 0.05% of its 13F portfolio. Citadel Investment Group is also relatively very bullish on the stock, designating 0.0001 percent of its 13F equity portfolio to SYN.
As industrywide interest jumped, key money managers have been driving this bullishness. MSDC Management, managed by Marc Lisker, Glenn Fuhrman and John Phelan, assembled the most outsized position in Synthetic Biologics Inc (NYSE:SYN). MSDC Management had $0.7 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also initiated a $0.4 million position during the quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Synthetic Biologics Inc (NYSE:SYN) but similarly valued. These stocks are Advaxis, Inc. (NASDAQ:ADXS), Houston Wire & Cable Company (NASDAQ:HWCC), Verb Technology Company, Inc. (NASDAQ:VERB), Williams Industrial Services Group Inc. (NYSE:WLMS), Lument Finance Trust, Inc. (NYSE:LFT), CSI Compressco LP (NASDAQ:CCLP), and Synacor Inc (NASDAQ:SYNC). This group of stocks' market caps resemble SYN's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ADXS,2,2220,0 HWCC,7,22249,1 VERB,3,195,-2 WLMS,2,29222,2 LFT,5,2562,0 CCLP,3,1210,0 SYNC,7,10133,3 Average,4.1,9684,0.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 4.1 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $1 million in SYN's case. Houston Wire & Cable Company (NASDAQ:HWCC) is the most popular stock in this table. On the other hand Advaxis, Inc. (NASDAQ:ADXS) is the least popular one with only 2 bullish hedge fund positions. Synthetic Biologics Inc (NYSE:SYN) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for SYN is 26. 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 17.2% in 2021 through June 11th and surpassed the market again by 3.3 percentage points. Unfortunately SYN wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); SYN investors were disappointed as the stock returned -4.4% since the end of March (through 6/11) 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.