Dendreon Corporation (DNDN): Are Hedge Funds Right About This Stock?

Dendreon Corporation (NASDAQ:DNDN) was in 13 hedge funds’ portfolio at the end of March. DNDN has seen a decrease in support from the world’s most elite money managers recently. There were 13 hedge funds in our database with DNDN positions at the end of the previous quarter. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

At the moment, there are a multitude of methods investors can use to analyze their holdings. A duo of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can trounce the market by a solid margin (see just how much).

Just as key, optimistic insider trading sentiment is a second way to break down the world of equities. As the old adage goes: there are a number of reasons for a bullish insider to get rid of shares of his or her company, but only one, very obvious reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this method if piggybackers know what to do (learn more here).

Now, it’s important to take a gander at the latest action encompassing Dendreon Corporation (NASDAQ:DNDN).

How are hedge funds trading Dendreon Corporation (NASDAQ:DNDN)?

In preparation for this quarter, a total of 13 of the hedge funds we track were bullish in this stock, a change of 0% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their holdings significantly.

Of the funds we track, Discovery Capital Management, managed by Rob Citrone, holds the biggest position in Dendreon Corporation (NASDAQ:DNDN). Discovery Capital Management has a $28 million position in the stock, comprising 0.4% of its 13F portfolio. Coming in second is Israel Englander of Millennium Management, with a $24.7 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedgies that are bullish include Samuel Isaly’s OrbiMed Advisors, D. E. Shaw’s D E Shaw and Stephen DuBois’s Camber Capital Management.

Judging by the fact that Dendreon Corporation (NASDAQ:DNDN) has experienced bearish sentiment from hedge fund managers, logic holds that there was a specific group of hedgies who were dropping their positions entirely last quarter. Interestingly, James E. Flynn’s Deerfield Management said goodbye to the biggest investment of the “upper crust” of funds we monitor, worth an estimated $33.8 million in stock.. Cliff Asness’s fund, AQR Capital Management, also dumped its stock, about $3 million worth.

How are insiders trading Dendreon Corporation (NASDAQ:DNDN)?

Insider buying is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time frame, Dendreon Corporation (NASDAQ:DNDN) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the returns exhibited by the aforementioned studies, retail investors must always watch hedge fund and insider trading sentiment, and Dendreon Corporation (NASDAQ:DNDN) is no exception.

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