Is SurModics, Inc. (NASDAQ:SRDX) worth your attention right now? Hedge funds are in a pessimistic mood. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience
To the average investor, there are dozens of methods market participants can use to track Mr. Market. Two of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can outclass the S&P 500 by a solid amount (see just how much).
Just as integral, bullish insider trading activity is a second way to break down the financial markets. There are a variety of stimuli for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Many empirical studies have demonstrated the impressive potential of this tactic if shareholders know where to look (learn more here).
Consequently, it’s important to take a gander at the key action surrounding SurModics, Inc. (NASDAQ:SRDX).
How have hedgies been trading SurModics, Inc. (NASDAQ:SRDX)?
At year’s end, a total of 8 of the hedge funds we track were bullish in this stock, a change of 0% from the third quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their holdings considerably.
Of the funds we track, Royce & Associates, managed by Chuck Royce, holds the biggest position in SurModics, Inc. (NASDAQ:SRDX). Royce & Associates has a $20.6 million position in the stock, comprising 0.1% of its 13F portfolio. On Royce & Associates’s heels is Jim Simons of Renaissance Technologies, with a $4.9 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining hedgies with similar optimism include Richard Driehaus’s Driehaus Capital, Joel Greenblatt’s Gotham Asset Management and John Overdeck and David Siegel’s Two Sigma Advisors.
Seeing as SurModics, Inc. (NASDAQ:SRDX) has experienced declining sentiment from the smart money, it’s safe to say that there lies a certain “tier” of fund managers who sold off their entire stakes heading into 2013. Interestingly, Israel Englander’s Millennium Management dumped the largest investment of the “upper crust” of funds we monitor, totaling an estimated $1.7 million in stock. These bearish behaviors are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with SurModics, Inc. (NASDAQ:SRDX)?
Insider purchases made by high-level executives is best served when the company we’re looking at has experienced transactions within the past six months. Over the last six-month time frame, SurModics, Inc. (NASDAQ:SRDX) has experienced zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to SurModics, Inc. (NASDAQ:SRDX). These stocks are Quidel Corporation (NASDAQ:QDEL), Synta Pharmaceuticals Corp. (NASDAQ:SNTA), Accelerate Diagnostics Inc (NASDAQ:AXDX), AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG), and Trinity Biotech plc (ADR) (NASDAQ:TRIB). This group of stocks belong to the diagnostic substances industry and their market caps match SRDX’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Quidel Corporation (NASDAQ:QDEL)||6||0||2|
|Synta Pharmaceuticals Corp. (NASDAQ:SNTA)||12||2||0|
|AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG)||9||0||2|
|Trinity Biotech plc (ADR) (NASDAQ:TRIB)||7||0||0|
With the results exhibited by our tactics, retail investors must always watch hedge fund and insider trading sentiment, and SurModics, Inc. (NASDAQ:SRDX) is no exception.