Should You Consider Investing In Neonode, Inc (NEON)?

Page 2 of 2

Because Neonode, Inc (NASDAQ:NEON) has experienced a bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of hedgies who sold off their entire stakes by the end of the third quarter. At the top of the heap, Joseph A. Jolson’s Harvest Capital Strategies cut the biggest stake of the 700 funds followed by Insider Monkey, totaling about $0.4 million in stock. Matthew Hulsizer’s fund, PEAK6 Capital Management, also dumped its holding, about $0.1 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 1 funds by the end of the third quarter.

Let’s go over hedge fund activity in other stocks similar to Neonode, Inc (NASDAQ:NEON). These stocks are Mitek Systems, Inc. (NASDAQ:MITK), Calithera Biosciences Inc (NASDAQ:CALA), Alimera Sciences Inc (NASDAQ:ALIM), and First Trust Strategic High Income Fd II (NYSE:FHY). This group of stocks’ market caps are similar to NEON’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MITK 6 1962 -1
CALA 5 21817 -1
ALIM 10 35337 -1
FHY 4 5106 0

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 $16 million. Alimera Sciences Inc (NASDAQ:ALIM) is the most popular stock in this table, while First Trust Strategic High Income Fd II (NYSE:FHY) is the least popular one with only 4 bullish hedge fund positions. With an aggregate value of hedge funds’ holdings worth $3.0 million, Neonode, Inc (NASDAQ:NEON) is not the least popular stock in this group but hedge fund interest is still below 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 ALIM might be a better candidate to consider a long position.

Page 2 of 2