Should You Buy Aptose Biosciences Inc (APTO)?

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Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Aptose Biosciences Inc (NASDAQ:APTO) but similarly valued. We will take a look at Cytori Therapeutics Inc. (USA) (NASDAQ:CYTX), Profire Energy, Inc. (NASDAQ:PFIE), LeapFrog Enterprises, Inc. (NYSE:LF), and Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP). All of these stocks’ market caps match APTO’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CYTX 4 1254 -2
PFIE 5 2535 0
LF 12 5276 -5
CRBP 4 6404 1

As you can see these stocks had an average of 6 hedge funds with bullish positions and the average amount invested in these stocks was $4 million. That figure was $5 million in APTO’s case. LeapFrog Enterprises, Inc. (NYSE:LF) is the most popular stock in this table. On the other hand Cytori Therapeutics Inc. (USA) (NASDAQ:CYTX) and Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) are the outsiders, with only 4 bullish hedge fund positions. Aptose Biosciences Inc (NASDAQ:APTO) is not the least popular stock in this group, but hedge fund interest is only 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 LF might be a better candidate to consider a long position.

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