Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the first quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Cue Biopharma, Inc. (NASDAQ:CUE) based on that data.
Cue Biopharma, Inc. (NASDAQ:CUE) has seen an increase in activity from the world's largest hedge funds lately. CUE was in 14 hedge funds' portfolios at the end of March. There were 11 hedge funds in our database with CUE positions at the end of the previous quarter. Our calculations also showed that CUE isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most stock holders, hedge funds are viewed as worthless, outdated financial vehicles of years past. While there are greater than 8000 funds in operation at present, We look at the leaders of this group, approximately 850 funds. Most estimates calculate that this group of people shepherd the lion's share of all hedge funds' total asset base, and by observing their first-class investments, Insider Monkey has come up with various investment strategies that have historically outpaced the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology's influence will go beyond online payments. So, we are checking out this futurist's moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Now we're going to take a peek at the key hedge fund action encompassing Cue Biopharma, Inc. (NASDAQ:CUE).
Hedge fund activity in Cue Biopharma, Inc. (NASDAQ:CUE)
At Q1's end, a total of 14 of the hedge funds tracked by Insider Monkey were long this stock, a change of 27% from the previous quarter. By comparison, 2 hedge funds held shares or bullish call options in CUE a year ago. With the smart money's capital changing hands, there exists a few key hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Nantahala Capital Management, managed by Wilmot B. Harkey and Daniel Mack, holds the number one position in Cue Biopharma, Inc. (NASDAQ:CUE). Nantahala Capital Management has a $35.5 million position in the stock, comprising 1.3% of its 13F portfolio. Sitting at the No. 2 spot is Behzad Aghazadeh of Avoro Capital Advisors (venBio Select Advisor), with a $26.5 million position; 0.9% of its 13F portfolio is allocated to the stock. Other hedge funds and institutional investors that hold long positions encompass David Greenspan's Slate Path Capital, Mark Hart III's Corriente Advisors and Nathaniel August's Mangrove Partners. In terms of the portfolio weights assigned to each position Corriente Advisors allocated the biggest weight to Cue Biopharma, Inc. (NASDAQ:CUE), around 12.56% of its 13F portfolio. Prosight Capital is also relatively very bullish on the stock, earmarking 3.66 percent of its 13F equity portfolio to CUE.
Now, some big names have been driving this bullishness. Ghost Tree Capital, managed by Ken Greenberg and David Kim, established the largest position in Cue Biopharma, Inc. (NASDAQ:CUE). Ghost Tree Capital had $1.8 million invested in the company at the end of the quarter. Joseph Edelman's Perceptive Advisors also initiated a $0.4 million position during the quarter. The other funds with brand new CUE positions are Cliff Asness's AQR Capital Management, Ken Griffin's Citadel Investment Group, and John Overdeck and David Siegel's Two Sigma Advisors.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Cue Biopharma, Inc. (NASDAQ:CUE) but similarly valued. We will take a look at UroGen Pharma Ltd. (NASDAQ:URGN), Ready Capital Corporation (NYSE:RC), Digital Turbine Inc (NASDAQ:APPS), and America's Car-Mart, Inc. (NASDAQ:CRMT). All of these stocks' market caps are closest to CUE's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position URGN,7,36342,-1 RC,9,16399,-2 APPS,22,49594,2 CRMT,10,30233,-11 Average,12,33142,-3 [/table]
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $33 million. That figure was $112 million in CUE's case. Digital Turbine Inc (NASDAQ:APPS) is the most popular stock in this table. On the other hand UroGen Pharma Ltd. (NASDAQ:URGN) is the least popular one with only 7 bullish hedge fund positions. Cue Biopharma, Inc. (NASDAQ:CUE) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but still beat the market by 16.8 percentage points. Hedge funds were also right about betting on CUE as the stock returned 72.2% in Q2 (through June 25th) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
