LDR Holding Corp (LDRH): Are Hedge Funds Right About This Stock?

Since LDR Holding Corp (NASDAQ:LDRH) has faced a declination in interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of money managers who were dropping their full holdings last quarter. Intriguingly, Brian Taylor’s Pine River Capital Management dropped the largest investment of the “upper crust” of funds followed by Insider Monkey, worth about $4 million in call options., and Matthew Hulsizer’s PEAK6 Capital Management was right behind this move, as the fund sold off about $1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 3 funds last quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as LDR Holding Corp (NASDAQ:LDRH) but similarly valued. These stocks are Costamare Inc (NYSE:CMRE), Krispy Kreme Doughnuts (NYSE:KKD), MDC Partners Inc. (USA) (NASDAQ:MDCA), and Denny’s Corporation (NASDAQ:DENN). This group of stocks’ market values resemble LDRH’s market value.

As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $119 million, while in LDRD, hedge funds have assembled stakes with a total value of $101 million. MDC Partners Inc. (USA) (NASDAQ:MDCA) is the most popular stock in this table, while Costamare Inc (NYSE:CMRE) is the least popular one with only 14 bullish hedge fund positions. Compared to these stocks LDR Holding Corp (NASDAQ:LDRH) is even less popular than CMRE. 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.