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Is Viropharma Inc (VPHM) Going to Burn These Hedge Funds?

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Viropharma Inc (NASDAQ:VPHM) was in 16 hedge funds’ portfolio at the end of March. VPHM has seen a decrease in activity from the world’s largest hedge funds in recent months. There were 21 hedge funds in our database with VPHM positions at the end of the previous quarter.

Viropharma Inc (NASDAQ:VPHM)

At the moment, there are tons of metrics investors can use to watch their holdings. A couple of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can beat the broader indices by a solid amount (see just how much).

Just as integral, optimistic insider trading activity is a second way to break down the investments you’re interested in. There are lots of incentives for a corporate insider to drop shares of his or her company, but only one, very obvious reason why they would buy. Various empirical studies have demonstrated the useful potential of this strategy if piggybackers understand what to do (learn more here).

With these “truths” under our belt, let’s take a glance at the recent action surrounding Viropharma Inc (NASDAQ:VPHM).

How are hedge funds trading Viropharma Inc (NASDAQ:VPHM)?

At Q1’s end, a total of 16 of the hedge funds we track held long positions in this stock, a change of -24% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings substantially.

According to our comprehensive database, Julian Baker and Felix Baker’s Baker Bros. Advisors had the biggest position in Viropharma Inc (NASDAQ:VPHM), worth close to $214.6 million, comprising 4.3% of its total 13F portfolio. On Baker Bros. Advisors’s heels is Palo Alto Investors, managed by William Leland Edwards, which held a $99.4 million position; the fund has 11.8% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Joseph Edelman’s Perceptive Advisors.

Since Viropharma Inc (NASDAQ:VPHM) has witnessed declining sentiment from the entirety of the hedge funds we track, it’s easy to see that there were a few fund managers that elected to cut their full holdings last quarter. Intriguingly, Sean Cullinan’s Point State Capital cut the largest investment of all the hedgies we key on, worth close to $17.1 million in stock.. Jeffrey Vinik’s fund, Vinik Asset Management, also cut its stock, about $6.3 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 5 funds last quarter.

How have insiders been trading Viropharma Inc (NASDAQ:VPHM)?

Insider trading activity, especially when it’s bullish, is best served when the company in question has experienced transactions within the past six months. Over the latest half-year time frame, Viropharma Inc (NASDAQ:VPHM) has experienced 1 unique insiders buying, and 4 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Viropharma Inc (NASDAQ:VPHM). These stocks are ImmunoGen, Inc. (NASDAQ:IMGN), Questcor Pharmaceuticals Inc (NASDAQ:QCOR), Synageva BioPharma Corp (NASDAQ:GEVA), Arena Pharmaceuticals, Inc. (NASDAQ:ARNA), and Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY). This group of stocks are in the biotechnology industry and their market caps are similar to VPHM’s market cap.

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