Verastem Inc (NASDAQ:VSTM) has experienced a decrease in activity from the world’s largest hedge funds of late.
At the moment, there are tons of methods shareholders can use to watch Mr. Market. A pair of the best are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best money managers can outperform the S&P 500 by a healthy amount (see just how much).
Just as important, positive insider trading sentiment is a second way to parse down the stock market universe. Obviously, there are a variety of motivations for an executive to cut shares of his or her company, but just one, very simple reason why they would buy. Many empirical studies have demonstrated the market-beating potential of this tactic if investors know where to look (learn more here).
Consequently, we’re going to take a look at the key action surrounding Verastem Inc (NASDAQ:VSTM).
What does the smart money think about Verastem Inc (NASDAQ:VSTM)?
At the end of the fourth quarter, a total of 6 of the hedge funds we track were long in this stock, a change of -25% from one quarter earlier. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings significantly.
When looking at the hedgies we track, Daniel Gold’s QVT Financial had the largest position in Verastem Inc (NASDAQ:VSTM), worth close to $2.3 million, comprising 0.2% of its total 13F portfolio. The second largest stake is held by Bridger Management, managed by Roberto Mignone, which held a $1.8 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedgies that hold long positions include Phill Gross and Robert Atchinson’s Adage Capital Management, Anand Parekh’s Alyeska Investment Group and Jean-Marie Eveillard’s First Eagle Investment Management.
Because Verastem Inc (NASDAQ:VSTM) has witnessed falling interest from the entirety of the hedge funds we track, it’s easy to see that there is a sect of hedge funds who were dropping their entire stakes last quarter. Intriguingly, Peter Kolchinsky’s RA Capital Management said goodbye to the biggest stake of all the hedgies we watch, worth an estimated $5.2 million in stock., and Samuel Isaly of OrbiMed Advisors was right behind this move, as the fund cut about $3.9 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 2 funds last quarter.
How are insiders trading Verastem Inc (NASDAQ:VSTM)?
Insider purchases made by high-level executives is best served when the company we’re looking at has experienced transactions within the past 180 days. Over the last half-year time frame, Verastem Inc (NASDAQ:VSTM) has experienced 3 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Verastem Inc (NASDAQ:VSTM). These stocks are Immunomedics, Inc. (NASDAQ:IMMU), BioTime, Inc. (NYSEAMEX:BTX), Corcept Therapeutics Incorporated (NASDAQ:CORT), Anika Therapeutics, Inc. (NASDAQ:ANIK), and Sinovac Biotech Ltd. (NASDAQ:SVA). This group of stocks are the members of the biotechnology industry and their market caps are similar to VSTM’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Immunomedics, Inc. (NASDAQ:IMMU)||3||0||0|
|BioTime, Inc. (NYSEAMEX:BTX)||1||1||1|
|Corcept Therapeutics Incorporated (NASDAQ:CORT)||4||3||0|
|Anika Therapeutics, Inc. (NASDAQ:ANIK)||6||0||2|
|Sinovac Biotech Ltd. (NASDAQ:SVA)||4||0||0|
With the results shown by our studies, everyday investors should always pay attention to hedge fund and insider trading sentiment, and Verastem Inc (NASDAQ:VSTM) is no exception.