Is Ocera Therapeutics Inc (OCRX) A Good Stock To Buy?

We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Ghost Tree Capital. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because none of the 700+ hedge funds tracked by Insider Monkey identified OCRX as a viable investment and initiated a position in the stock.

Let’s now review hedge fund activity in other stocks similar to Ocera Therapeutics Inc (NASDAQ:OCRX). These stocks are Trilogy Metals Inc (NYSEMKT:TMQ), Capricor Therapeutics Inc (NASDAQ:CAPR), Barington/Hilco Acquisition Corp. Common Stock (NASDAQ:BHAC), and bebe stores, inc. (NASDAQ:BEBE). This group of stocks’ market values are similar to OCRX’s market value.

As you can see these stocks had an average of 4.75 hedge funds with bullish positions and the average amount invested in these stocks was $7 million. That figure was $15 million in OCRX’s case. Trilogy Metals Inc (NYSEMKT:TMQ) is the most popular stock in this table. On the other hand Capricor Therapeutics Inc (NASDAQ:CAPR) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Ocera Therapeutics Inc (NASDAQ:OCRX) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

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