Hedge Funds Are Crazy About Analogic Corporation (ALOG)

The worries about the economic slowdown in China and the ongoing uncertainty about the path of interest-rate increases triggered several waves of equity sell-offs during the third quarter. Of course, most hedge funds and other asset managers had to stomach substantial losses during the bloody three-month period, which might have caused some to consider fleeing the U.S. equity markets. Interestingly, smaller-cap stocks registered higher losses than large-capitalization stocks during the September quarter, suggesting that institutional investors heavily discarded seemingly riskier equities amid high uncertainty and turmoil. In fact, the Russell 2000 Index lost 11.9% in the third quarter, while the Standard and Poor’s 500 benchmark declined a mere 6.4%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Analogic Corporation (NASDAQ:ALOG).

Analogic Corporation (NASDAQ:ALOG) is a technology company that produces systems for medical imaging ultrasound and security systems. The stock is trading at around 19 times forward earnings and registered an increase in hedge fund sentiment during the third quarter. However,  the level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Spark Therapeutics Inc (NASDAQ:ONCE), Globant SA (NYSE:GLOB), and OM Group, Inc. (NYSE:OMG) to gather more data points.

According to most investors, hedge funds are seen as unimportant, old investment vehicles of the past. While there are more than 8000 funds with their doors open at present, We hone in on the aristocrats of this club, around 700 funds. These hedge fund managers administer the majority of all hedge funds’ total capital, and by paying attention to their top equity investments, Insider Monkey has brought to light several investment strategies that have historically defeated the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points annually for a decade in their back tests.

Keeping this in mind, let’s take a look at the fresh action encompassing Analogic Corporation (NASDAQ:ALOG).

How have hedgies been trading Analogic Corporation (NASDAQ:ALOG)?

Heading into Q4, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 7% from the second quarter. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Chuck Royce’s Royce & Associates has the most valuable position in Analogic Corporation (NASDAQ:ALOG), worth close to $44.4 million, amounting to 0.2% of its total 13F portfolio. The second most bullish fund is Mariko Gordon’s Daruma Asset Management, with a $43.6 million position; 2.7% of its 13F portfolio is allocated to the stock. Other hedge funds and institutional investors with similar optimism include Israel Englander’s Millennium Management, Jeffrey Moskowitz’s Harvey Partners, and Chao Ku’s Nine Chapters Capital Management.