Is Model N Inc (MODN) A Good Stock To Buy?

Since Model N Inc (NYSE:MODN) has experienced falling interest from the smart money, it’s easy to see that there is a sect of money managers that slashed their full holdings by the end of the third quarter. It’s worth mentioning that Josh Goldberg’s G2 Investment Partners Management cut the largest investment of all the hedgies watched by Insider Monkey, comprising about $1 million in stock. Peter Muller’s fund, PDT Partners, also said goodbye to its stock, about $0.1 million worth.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Model N Inc (NYSE:MODN) but similarly valued. These stocks are Orexigen Therapeutics, Inc. (NASDAQ:OREX), Tandem Diabetes Care Inc (NASDAQ:TNDM), CTI BioPharma Corp (NASDAQ:CTIC), and Corenergy Infrastructure Trust Inc (NYSE:CORR). This group of stocks’ market valuations are similar to MODN’s market valuation.

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $29 million, below the $65 million figure in MODN’s case. Orexigen Therapeutics, Inc. (NASDAQ:OREX) is the most popular stock in this table. On the other hand Tandem Diabetes Care Inc (NASDAQ:TNDM) is the least popular one with only 8 bullish hedge fund positions. Model N Inc (NYSE:MODN) 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 OREX might be a better candidate to consider a long position.