Is Genomic Health, Inc. (NASDAQ:GHDX) a sound investment today? Investors who are in the know are reducing their bets on the stock. The number of long hedge fund positions were cut by 2 lately.
At the moment, there are plenty of methods shareholders can use to watch Mr. Market. A duo of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top investment managers can outclass the S&P 500 by a healthy amount (see just how much).
Equally as beneficial, positive insider trading sentiment is a second way to parse down the world of equities. Obviously, there are many stimuli for a corporate insider to drop shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many empirical studies have demonstrated the valuable potential of this strategy if you understand what to do (learn more here).
Consequently, it’s important to take a gander at the latest action encompassing Genomic Health, Inc. (NASDAQ:GHDX).
What have hedge funds been doing with Genomic Health, Inc. (NASDAQ:GHDX)?
At Q1’s end, a total of 12 of the hedge funds we track held long positions in this stock, a change of -14% from the first quarter. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their holdings meaningfully.
Of the funds we track, Julian Baker and Felix Baker’s Baker Bros. Advisors had the largest position in Genomic Health, Inc. (NASDAQ:GHDX), worth close to $355.7 million, comprising 7.1% of its total 13F portfolio. The second largest stake is held by Jim Simons of Renaissance Technologies, with a $7.6 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other hedge funds that hold long positions include Donald Chiboucis’s Columbus Circle Investors, Israel Englander’s Millennium Management and Ken Griffin’s Citadel Investment Group.
Since Genomic Health, Inc. (NASDAQ:GHDX) has witnessed declining sentiment from hedge fund managers, we can see that there was a specific group of fund managers that decided to sell off their entire stakes heading into Q2. Interestingly, Drew Cupps’s Cupps Capital Management dumped the biggest position of the 450+ funds we monitor, comprising about $1.1 million in stock.. Paul Tudor Jones’s fund, Tudor Investment Corp, also said goodbye to its stock, about $0.6 million worth. These transactions are interesting, as total hedge fund interest dropped by 2 funds heading into Q2.
How are insiders trading Genomic Health, Inc. (NASDAQ:GHDX)?
Insider purchases made by high-level executives is most useful when the primary stock in question has seen transactions within the past six months. Over the last half-year time frame, Genomic Health, Inc. (NASDAQ:GHDX) has seen 1 unique insiders buying, and 7 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Genomic Health, Inc. (NASDAQ:GHDX). These stocks are ICON plc – Ordinary Shares (NASDAQ:ICLR), Novadaq Technologies Inc. (NASDAQ:NVDQ), Nordion Inc (USA) (NYSE:NDZ), WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX), and Bio-Reference Laboratories Inc (NASDAQ:BRLI). This group of stocks belong to the medical laboratories & research industry and their market caps are similar to GHDX’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|ICON plc – Ordinary Shares (NASDAQ:ICLR)||20||0||0|
|Novadaq Technologies Inc. (NASDAQ:NVDQ)||10||0||0|
|Nordion Inc (USA) (NYSE:NDZ)||16||0||0|
|WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX)||13||0||0|
|Bio-Reference Laboratories Inc (NASDAQ:BRLI)||11||0||2|
With the returns demonstrated by Insider Monkey’s tactics, retail investors must always watch hedge fund and insider trading activity, and Genomic Health, Inc. (NASDAQ:GHDX) is no exception.