Is InterDigital, Inc. (IDCC) Going to Burn These Hedge Funds?

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Is InterDigital, Inc. (NASDAQ:IDCC) an excellent stock to buy now? The smart money is getting less bullish. The number of bullish hedge fund positions were trimmed by 3 in recent months.

InterDigital, Inc. (NASDAQ:IDCC)At the moment, there are tons of gauges shareholders can use to track their holdings. A duo of the most underrated 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 best money managers can beat the S&P 500 by a solid margin (see just how much).

Just as beneficial, optimistic insider trading activity is another way to break down the world of equities. Obviously, there are plenty of stimuli for an executive to get rid of shares of his or her company, but just one, very obvious reason why they would buy. Many empirical studies have demonstrated the useful potential of this strategy if shareholders understand where to look (learn more here).

Keeping this in mind, we’re going to take a look at the latest action regarding InterDigital, Inc. (NASDAQ:IDCC).

How have hedgies been trading InterDigital, Inc. (NASDAQ:IDCC)?

At the end of the first quarter, a total of 16 of the hedge funds we track were bullish in this stock, a change of -16% from one quarter earlier. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings substantially.

Of the funds we track, John Paulson’s Paulson & Co had the biggest position in InterDigital, Inc. (NASDAQ:IDCC), worth close to $143.5 million, accounting for 0.8% of its total 13F portfolio. Coming in second is Robert Rodriguez and Steven Romick of First Pacific Advisors LLC, with a $96.2 million position; 1% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions include Amy Minella’s Cardinal Capital, Spencer M. Waxman’s Shannon River Fund Management and Jay Petschek and Steven Major’s Corsair Capital Management.

Judging by the fact that InterDigital, Inc. (NASDAQ:IDCC) has faced falling interest from hedge fund managers, logic holds that there is a sect of fund managers that decided to sell off their entire stakes at the end of the first quarter. At the top of the heap, Sander Gerber’s Hudson Bay Capital Management said goodbye to the largest stake of all the hedgies we watch, comprising about $13.6 million in call options, and Brett Hendrickson of Nokomis Capital was right behind this move, as the fund said goodbye to about $3.2 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 3 funds at the end of the first quarter.

How have insiders been trading InterDigital, Inc. (NASDAQ:IDCC)?

Bullish insider trading is particularly usable when the company we’re looking at has seen transactions within the past half-year. Over the last half-year time frame, InterDigital, Inc. (NASDAQ:IDCC) has seen zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to InterDigital, Inc. (NASDAQ:IDCC). These stocks are MetroPCS Communications Inc (NYSE:PCS), Partner Communications Company Ltd (ADR) (NASDAQ:PTNR), Ubiquiti Networks Inc (NASDAQ:UBNT), United States Cellular Corporation (NYSE:USM), and Telephone & Data Systems, Inc. (NYSE:TDS). This group of stocks are the members of the wireless communications industry and their market caps resemble IDCC’s market cap.

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