Is Rezolute, Inc. (RZLT) A Good Stock To Buy?
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 Rezolute, Inc. (NASDAQ:RZLT).
Is RZLT a good stock to buy? Rezolute, Inc. (NASDAQ:RZLT) was in 5 hedge funds' portfolios at the end of March. The all time high for this statistic was 4. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. RZLT investors should pay attention to an increase in hedge fund interest lately. There were 4 hedge funds in our database with RZLT positions at the end of the fourth quarter. Our calculations also showed that RZLT 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 Griffin of Citadel Investment Group
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund owns nearly 40% of this $23 biotech stock and is trying to buy the rest for around $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 review the fresh hedge fund action surrounding Rezolute, Inc. (NASDAQ:RZLT).
Do Hedge Funds Think RZLT Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25% from one quarter earlier. By comparison, 0 hedge funds held shares or bullish call options in RZLT a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
Among these funds, Citadel Investment Group held the most valuable stake in Rezolute, Inc. (NASDAQ:RZLT), which was worth $2.2 million at the end of the fourth quarter. On the second spot was Armistice Capital which amassed $2 million worth of shares. Biotechnology Value Fund / BVF Inc, Millennium Management, and 683 Capital Partners 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 Biotechnology Value Fund / BVF Inc allocated the biggest weight to Rezolute, Inc. (NASDAQ:RZLT), around 0.05% of its 13F portfolio. Armistice Capital is also relatively very bullish on the stock, earmarking 0.05 percent of its 13F equity portfolio to RZLT.
As aggregate interest increased, key hedge funds were leading the bulls' herd. Millennium Management, managed by Israel Englander, created the most outsized position in Rezolute, Inc. (NASDAQ:RZLT). Millennium Management had $0.2 million invested in the company at the end of the quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Rezolute, Inc. (NASDAQ:RZLT) but similarly valued. These stocks are Predictive Oncology Inc. (NASDAQ:POAI), Evoke Pharma Inc (NASDAQ:EVOK), Kaspien Holdings Inc. (NASDAQ:KSPN), Dawson Geophysical Company (NASDAQ:DWSN), SeaChange International, Inc. (NASDAQ:SEAC), Unique Fabricating Inc (NYSE:UFAB), and First US Bancshares, Inc. (NASDAQ:FUSB). This group of stocks' market values match RZLT's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position POAI,2,3200,2 EVOK,2,2645,-1 KSPN,1,2508,0 DWSN,3,5317,-1 SEAC,3,255,-3 UFAB,3,5446,1 FUSB,2,4095,0 Average,2.3,3352,-0.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.3 hedge funds with bullish positions and the average amount invested in these stocks was $3 million. That figure was $6 million in RZLT's case. Dawson Geophysical Company (NASDAQ:DWSN) is the most popular stock in this table. On the other hand Kaspien Holdings Inc. (NASDAQ:KSPN) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Rezolute, Inc. (NASDAQ:RZLT) is more popular among hedge funds. Our overall hedge fund sentiment score for RZLT is 86. 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 returned 17.4% in 2021 through June 18th but still managed to beat the market by 6.1 percentage points. Hedge funds were also right about betting on RZLT as the stock returned 85.6% since the end of March (through 6/18) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
