Is Novadaq Technologies Inc. (NVDQ) Going to Burn These Hedge Funds?

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Novadaq Technologies Inc. (NASDAQ:NVDQ) has seen an increase in hedge fund interest lately.

In the financial world, there are a multitude of gauges market participants can use to track their holdings. A couple of the best are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite hedge fund managers can outclass their index-focused peers by a healthy margin (see just how much).

Prem Watsa

Just as integral, optimistic insider trading activity is another way to break down the world of equities. Just as you’d expect, there are plenty of reasons for an executive to sell shares of his or her company, but just one, very simple reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this strategy if piggybackers understand where to look (learn more here).

With all of this in mind, let’s take a peek at the recent action surrounding Novadaq Technologies Inc. (NASDAQ:NVDQ).

What have hedge funds been doing with Novadaq Technologies Inc. (NASDAQ:NVDQ)?

At the end of the first quarter, a total of 10 of the hedge funds we track held long positions in this stock, a change of 11% from the first quarter. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their stakes substantially.

According to our comprehensive database, Prem Watsa’s Fairfax Financial Holdings had the largest position in Novadaq Technologies Inc. (NASDAQ:NVDQ), worth close to $23.3 million, comprising 0.9% of its total 13F portfolio. Sitting at the No. 2 spot is Kevin Kotler of Broadfin Capital, with a $19.6 million position; 4.3% of its 13F portfolio is allocated to the stock. Some other peers that hold long positions include Phill Gross and Robert Atchinson’s Adage Capital Management, Nathan Fischel’s DAFNA Capital Management and Brian Ashford-Russell and Tim Woolley’s Polar Capital.

Consequently, key hedge funds have jumped into Novadaq Technologies Inc. (NASDAQ:NVDQ) headfirst. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the most outsized position in Novadaq Technologies Inc. (NASDAQ:NVDQ). Adage Capital Management had 11.9 million invested in the company at the end of the quarter. Donald Chiboucis’s Columbus Circle Investors also made a $2 million investment in the stock during the quarter. The only other fund with a brand new NVDQ position is Israel Englander’s Millennium Management.

How are insiders trading Novadaq Technologies Inc. (NASDAQ:NVDQ)?

Insider trading activity, especially when it’s bullish, is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the last six-month time frame, Novadaq Technologies Inc. (NASDAQ:NVDQ) has seen zero unique insiders purchasing, and zero 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 Novadaq Technologies Inc. (NASDAQ:NVDQ). These stocks are TearLab Corporation (NASDAQ:TEAR), China Cord Blood Corp (NYSE:CO), Bio-Reference Laboratories Inc (NASDAQ:BRLI), Trius Therapeutics, Inc. (NASDAQ:TSRX), and Nordion Inc (USA) (NYSE:NDZ). This group of stocks are the members of the medical laboratories & research industry and their market caps resemble NVDQ’s market cap.

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