Do Hedge Funds Love NeoGenomics, Inc. (NEO)?

We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Balyasny Asset Management. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically, a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case here because only one of the 700+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Ellington).

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as NeoGenomics, Inc. (NASDAQ:NEO) but similarly valued. We will take a look at Perry Ellis International, Inc. (NASDAQ:PERY), Addus Homecare Corporation (NASDAQ:ADUS), and Campus Crest Communities Inc (NYSE:CCG). This group of stocks’ market valuations are closest to NeoGenomics, Inc. (NASDAQ:NEO)’s market valuation.

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $47 million. That figure was $15 million in NeoGenomics, Inc. (NASDAQ:NEO)’s case. Perry Ellis International, Inc. (NASDAQ:PERY) is the most popular stock in this table. On the other hand, Addus Homecare Corporation (NASDAQ:ADUS) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks NeoGenomics, Inc. (NASDAQ:NEO) is even less popular than Addus Homecare Corporation (NASDAQ:ADUS). Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case, more research is warranted.