Is Ligand Pharmaceuticals Inc. (LGND) A Good Stock To Buy?

Due to the fact that Ligand Pharmaceuticals Inc. (NASDAQ:LGND) has faced declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there was a specific group of hedgies that decided to sell off their entire stakes in the third quarter. Intriguingly, Matthew Hulsizer’s PEAK6 Capital Management sold off the biggest position of the “upper crust” of funds tracked by Insider Monkey, comprising about $10.2 million in stock. D E Shaw, also dumped its stock, about $3.8 million worth. These moves are interesting, as total hedge fund interest was cut by 3 funds in the third quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Ligand Pharmaceuticals Inc. (NASDAQ:LGND) but similarly valued. These stocks are Select Income REIT (NYSE:SIR), Washington Real Estate Investment Trust (NYSE:WRE), Holly Energy Partners, L.P. (NYSE:HEP), and Tessera Technologies, Inc. (NASDAQ:TSRA). This group of stocks’ market values are similar to LGND’s market value.

As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $119 million. That figure was $210 million in LGND’s case. Tessera Technologies, Inc. (NASDAQ:TSRA) is the most popular stock in this table. On the other hand Washington Real Estate Investment Trust (NYSE:WRE) is the least popular one with only 5 bullish hedge fund positions. Ligand Pharmaceuticals Inc. (NASDAQ:LGND) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard TSRA might be a better candidate to consider a long position.