We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Perceptive Advisors. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Alyeska Investment Group).
Let’s now review hedge fund activity in other stocks similar to Atara Biotherapeutics Inc (NASDAQ:ATRA). These stocks are Cedar Realty Trust Inc (NYSE:CDR), Materion Corp (NYSE:MTRN), Tredegar Corporation (NYSE:TG), and Ciner Resources LP (NYSE:CINR). This group of stocks’ market valuations match ATRA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CDR | 5 | 19220 | -1 |
| MTRN | 10 | 39790 | -4 |
| TG | 7 | 93977 | -2 |
| CINR | 4 | 10688 | 4 |
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $41 million. That figure was $211 million in ATRA’s case. Materion Corp (NYSE:MTRN) is the most popular stock in this table. On the other hand Ciner Resources LP (NYSE:CINR) is the least popular one with only 4 bullish hedge fund positions. Atara Biotherapeutics Inc (NASDAQ:ATRA) 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 MTRN might be a better candidate to consider taking a long position in.
Disclosure: None
