Array Biopharma Inc (ARRY): Hedge Funds Are Bearish and Insiders Are Undecided, What Should You Do?

Is Array Biopharma Inc (NASDAQ:ARRY) a good investment?

At the moment, there are many methods investors can use to analyze Mr. Market. Some of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best hedge fund managers can beat the S&P 500 by a healthy amount (see just how much).

Just as necessary, positive insider trading sentiment is a second way to look at the investments you’re interested in. Obviously, there are a number of incentives for an upper level exec to drop shares of his or her company, but only one, very clear reason why they would buy. Plenty of academic studies have demonstrated the impressive potential of this method if piggybackers understand what to do (learn more here).

Keeping this in mind, it’s important to examine the recent info for Array Biopharma Inc (NASDAQ:ARRY).

What does the smart money think about Array Biopharma Inc (NASDAQ:ARRY)?

In preparation for the third quarter, a total of 17 of the hedge funds we track were long in this stock, a change of -15% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were upping their stakes significantly.

According to our 13F database, James E. Flynn’s Deerfield Management had the most valuable position in Array Biopharma Inc (NASDAQ:ARRY), worth close to $49.4 million, comprising 2.3% of its total 13F portfolio. Sitting at the No. 2 spot is OrbiMed Advisors, managed by Samuel Isaly, which held a $22.1 million position; 0.5% of its 13F portfolio is allocated to the stock. Other hedgies that are bullish include Jeremy Green’s Redmile Group, Daniel Gold’s QVT Financial and Thomas E. Claugus’s GMT Capital.

Judging by the fact that Array Biopharma Inc (NASDAQ:ARRY) has faced dropping sentiment from the entirety of the hedge funds we track, it’s easy to see that there was a specific group of money managers who were dropping their positions entirely heading into Q2. At the top of the heap, Jim Simons’s Renaissance Technologies dumped the biggest position of all the hedgies we monitor, valued at close to $0.4 million in stock, and SAC Subsidiary of CR Intrinsic Investors was right behind this move, as the fund said goodbye to about $0.3 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 3 funds heading into Q2.

What do corporate executives and insiders think about Array Biopharma Inc (NASDAQ:ARRY)?

Insider buying made by high-level executives is most useful when the company in question has seen transactions within the past six months. Over the latest 180-day time period, Array Biopharma Inc (NASDAQ:ARRY) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Array Biopharma Inc (NASDAQ:ARRY). These stocks are EXACT Sciences Corporation (NASDAQ:EXAS), ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD), Merrimack Pharmaceuticals Inc (NASDAQ:MACK), Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR), and Cadence Pharmaceuticals, Inc. (NASDAQ:CADX). All of these stocks are in the biotechnology industry and their market caps are closest to ARRY’s market cap.

Using the returns shown by Insider Monkey’s strategies, average investors must always track hedge fund and insider trading sentiment, and Array Biopharma Inc (NASDAQ:ARRY) is an important part of this process.

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