Is QLT Inc. (QLTI) A Good Stock To Buy?

Due to the fact that QLT Inc. (USA) (NASDAQ:QLTI) has faced declining sentiment from the entirety of the hedge funds we track, we can see that there exists a select few funds who were dropping their full holdings in the third quarter. It’s worth mentioning that Steven Boyd’s Armistice Capital said goodbye to the largest investment of all the hedgies tracked by Insider Monkey, valued at an estimated $2.7 million in stock, and Peter S. Park’s Park West Asset Management was right behind this move, as the fund dumped about $2.1 million worth. These moves are interesting, as aggregate hedge fund interest was cut by 2 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks similar to QLT Inc. (USA) (NASDAQ:QLTI). These stocks are Twin Disc, Incorporated (NASDAQ:TWIN), SandRidge Energy Inc. (NYSE:SD), Datalink Corporation (NASDAQ:DTLK), and Silicon Graphics International Corp (NASDAQ:SGI). This group of stocks’ market caps are closest to QLTI’s market cap.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $20 million. That figure was $60 million in QLTI’s case. SandRidge Energy Inc. (NYSE:SD) is the most popular stock in this table. On the other hand Twin Disc, Incorporated (NASDAQ:TWIN) is the least popular one with only 7 bullish hedge fund positions. QLT Inc. (USA) (NASDAQ:QLTI) is not the most popular stock in this group but hedge fund interest is still above average. This is a positive signal however, we don’t like the fact that some hedge funds cut their losses and got out of the stock. QLTI may be an attractive stock but we’d like to see bullish activity before spending hours on researching a stock.