Do Hedge Funds Love Medgenics Inc (MDGN)?

Due to the fact that Medgenics Inc (NYSEMKT:MDGN) has witnessed declining sentiment from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of money managers that decided to sell off their entire stakes in the third quarter. At the top of the heap, Joseph Edelman’s Perceptive Advisors cut the largest investment of the 700 funds monitored by Insider Monkey, valued at an estimated $2.9 million in stock, and Jim Simons’s Renaissance Technologies was right behind this move, as the fund cut about $0.3 million worth. These bearish behaviors are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Medgenics Inc (NYSEMKT:MDGN) but similarly valued. We will take a look at JAKKS Pacific, Inc. (NASDAQ:JAKK), Calamos Asset Management, Inc (NASDAQ:CLMS), Medley Management Inc (NYSE:MDLY), and Pernix Therapeutics Holdings Inc (NASDAQ:PTX). All of these stocks’ market caps are closest to MDGN’s market cap.

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $34 million, compared to $26 million in MDGN’s case. Pernix Therapeutics Holdings Inc (NASDAQ:PTX) is the most popular stock in this table. On the other hand Medley Management Inc (NYSE:MDLY) is the least popular one with only 4 bullish hedge fund positions. Medgenics Inc (NYSEMKT:MDGN) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard PTX might be a better candidate to consider a long position.