Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD) investors should pay attention to a decrease in support from the world’s most elite money managers lately.
In today’s marketplace, there are tons of metrics market participants can use to watch Mr. Market. A couple of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top investment managers can beat the S&P 500 by a healthy amount (see just how much).
Just as beneficial, bullish insider trading activity is a second way to parse down the marketplace. Obviously, there are many incentives for an upper level exec to get rid of shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if piggybackers understand where to look (learn more here).
With these “truths” under our belt, it’s important to take a peek at the latest action regarding Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD).
What have hedge funds been doing with Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD)?
At the end of the first quarter, a total of 11 of the hedge funds we track held long positions in this stock, a change of 0% from the first quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their holdings significantly.
When looking at the hedgies we track, Jerome Pfund and Michael Sjostrom’s Sectoral Asset Management had the largest position in Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD), worth close to $67.8 million, accounting for 2.1% of its total 13F portfolio. On Sectoral Asset Management’s heels is Phill Gross and Robert Atchinson of Adage Capital Management, with a $26.3 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedgies that hold long positions include Roberto Mignone’s Bridger Management, Julian Baker and Felix Baker’s Baker Bros. Advisors and Drew Cupps’s Cupps Capital Management.
Due to the fact that Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD) has experienced declining sentiment from hedge fund managers, we can see that there is a sect of money managers that elected to cut their entire stakes last quarter. Intriguingly, Lee Ainslie’s Maverick Capital said goodbye to the biggest stake of the 450+ funds we key on, comprising about $23.3 million in stock.. Israel Englander’s fund, Millennium Management, also dropped its stock, about $1.5 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD)?
Insider trading activity, especially when it’s bullish, is most useful when the primary stock in question has seen transactions within the past half-year. Over the latest 180-day time frame, Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD) has seen zero unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD). These stocks are PerkinElmer, Inc. (NYSE:PKI), WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX), PAREXEL International Corporation (NASDAQ:PRXL), Alere Inc (NYSE:ALR), and ICON plc – Ordinary Shares (NASDAQ:ICLR). All of these stocks are in the medical laboratories & research industry and their market caps are closest to IRWD’s market cap.