Hedge Funds Are Selling Cutera, Inc. (CUTR)

Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow over 700 of the best-performing investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Cutera, Inc. (NASDAQ:CUTR), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Cutera, Inc. (NASDAQ:CUTR) has seen a decrease in activity from the world’s largest hedge funds in recent months. At the end of this article, we will also compare Cutera, Inc. (NASDAQ:CUTR) to other stocks, including Garnero Group Acquisition Co (NASDAQ:GGAC), Clearfield, Inc. (NASDAQ:CLFD), and Old Second Bancorp Inc. (NASDAQ:OSBC) to get a better sense of its popularity.

To most stock holders, hedge funds are perceived as unimportant, outdated investment tools of the past. While there are more than 8000 funds with their doors open at the moment, our experts look at the bigwigs of this group, about 700 funds. These hedge fund managers command the lion’s share of the hedge fund industry’s total capital, and by paying attention to their top equity investments, Insider Monkey has brought to light many investment strategies that have historically outstripped the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outpaced the S&P 500 index by 12 percentage points per year for a decade in their back tests.

Now, let’s take a peek at the key action surrounding Cutera, Inc. (NASDAQ:CUTR).

What does the smart money think about Cutera, Inc. (NASDAQ:CUTR)?

At the end of the third quarter, a total of 13 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 19% from the previous quarter. With hedgies’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Craig A. Drill’s Craig Drill Capital has the most valuable position in Cutera, Inc. (NASDAQ:CUTR), worth close to $14.2 million, comprising 20.2% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, with a $12 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Remaining professional money managers with similar optimism include Mario Gabelli’s GAMCO Investors, Brian C. Freckmann’s Lyon Street Capital, and Tom Henwood’s OMT Capital Management.

Due to the fact that Cutera, Inc. (NASDAQ:CUTR) has experienced a declining sentiment from the aggregate hedge fund industry, we can see that there lies a certain “tier” of hedge funds that elected to cut their entire stakes last quarter. It’s worth mentioning that Richard Mashaal’s Rima Senvest Management cut the largest stake of all the hedgies followed by Insider Monkey, valued at an estimated $17.7 million in stock. Peter Muller’s fund, PDT Partners, also said goodbye to its stock, about $0.4 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 3 funds last quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Cutera, Inc. (NASDAQ:CUTR) but similarly valued. We will take a look at Garnero Group Acquisition Co (NASDAQ:GGAC), Clearfield, Inc. (NASDAQ:CLFD), Old Second Bancorp Inc. (NASDAQ: OSBC), and Affimed NV (NASDAQ:AFMD). This group of stocks’ market values matches Cutera, Inc. (NASDAQ:CUTR)’s market value.

As you can see, these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $29 million. That figure was $44 million in Cutera, Inc. (NASDAQ:CUTR)’s case. Affimed NV (NASDAQ:AFMD) is the most popular stock in this table. On the other hand, Garnero Group Acquisition Co (NASDAQ:GGAC) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks, Cutera, Inc. (NASDAQ:CUTR) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.