Is ArQule, Inc. (NASDAQ:ARQL) a good investment?
In the 21st century investor’s toolkit, there are many metrics shareholders can use to monitor stocks. A duo of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite money managers can outperform the broader indices by a superb amount (see just how much).
Equally as necessary, optimistic insider trading sentiment is another way to analyze the marketplace. As the old adage goes: there are a number of motivations for an upper level exec to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the impressive potential of this tactic if "monkeys" know where to look (learn more here).
Keeping this in mind, let's discuss the newest info about ArQule, Inc. (NASDAQ:ARQL).
Heading into Q3, a total of 10 of the hedge funds we track were long in this stock, a change of -9% from the previous quarter. With hedge funds' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes considerably.
Out of the hedge funds we follow, First Eagle Investment Management, managed by Matt McLennan, holds the most valuable position in ArQule, Inc. (NASDAQ:ARQL). First Eagle Investment Management has a $10.5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On First Eagle Investment Management's heels is Samuel Isaly of OrbiMed Advisors, with a $6.5 million position; 0.1% of its 13F portfolio is allocated to the stock. Some other hedgies that are bullish include Andrew J. M. Spokes's Farallon Capital, Julian Baker and Felix Baker's Baker Bros. Advisors and Jim Simons's Renaissance Technologies.
Judging by the fact that ArQule, Inc. (NASDAQ:ARQL) has experienced declining interest from upper-tier hedge fund managers, logic holds that there is a sect of money managers who were dropping their positions entirely in Q1. Intriguingly, Thomas Bailard's Bailard Inc said goodbye to the largest position of the 450+ funds we monitor, totaling about $1.4 million in stock, and Peter Algert and Kevin Coldiron of Algert Coldiron Investors was right behind this move, as the fund dumped about $0.5 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest dropped by 1 funds in Q1.
Insider buying made by high-level executives is at its handiest when the company in focus has experienced transactions within the past half-year. Over the last six-month time frame, ArQule, Inc. (NASDAQ:ARQL) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We'll also take a look at the relationship between both of these indicators in other stocks similar to ArQule, Inc. (NASDAQ:ARQL). These stocks are ShangPharma Corp (ADR) (NYSE:SHP), OncoGenex Pharmaceuticals Inc (NASDAQ:OGXI), Enzon Pharmaceuticals, Inc. (NASDAQ:ENZN), Durata Therapeutics Inc (NASDAQ:DRTX), and Cytokinetics, Inc. (NASDAQ:CYTK). This group of stocks are the members of the biotechnology industry and their market caps match ARQL's market cap.