Is Loxo Oncology Inc (LOXO) Worthy of Your Portfolio?

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As industrywide interest jumped, key money managers were leading the bulls’ herd. Opaleye Management, led by James A. Silverman, established the most outsized position in Loxo Oncology Inc (NASDAQ:LOXO). Opaleye Management had $2.9 million invested in the company at the end of the quarter.

Let’s also examine hedge fund activity in other stocks similar to Loxo Oncology Inc (NASDAQ:LOXO). We will take a look at Modine Manufacturing Co. (NYSE:MOD), Amarin Corporation plc (ADR) (NASDAQ:AMRN), TETRA Technologies, Inc. (NYSE:TTI), and Ashford Hospitality Trust, Inc. (NYSE:AHT). This group of stocks’ market values are closest to LOXO’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MOD 10 43734 -1
AMRN 19 221721 7
TTI 17 67275 -6
AHT 13 27968 -1

As you can see these stocks had an average of 15 hedge funds with bullish positions and the average amount invested in these stocks was $90 million. That figure was $225 million in LOXO’s case. Amarin Corporation plc (ADR) (NASDAQ:AMRN) is the most popular stock in this table. On the other hand Modine Manufacturing Co. (NYSE:MOD) is the least popular one with only 10 bullish hedge fund positions. Loxo Oncology Inc (NASDAQ:LOXO) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard AMRN might be a better candidate to consider taking a long position in.

Disclosure: None

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