At Insider Monkey we track the activity of some of the best-performing hedge funds like Appaloosa Management, Baupost, and Third Point because we determined that some of the stocks that they are collectively bullish on can help us generate returns above the broader indices. Out of thousands of stocks that hedge funds invest in, small-caps can provide the best returns over the long term due to the fact that these companies are less efficiently priced and are usually under the radars of mass-media, analysts and dumb money. This is why we follow the smart money moves in the small-cap space.
SCYNEXIS Inc (NASDAQ:SCYX) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 9 hedge funds’ portfolios at the end of September. 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 Lakeland Industries, Inc. (NASDAQ:LAKE), Nicholas Financial, Inc. (NASDAQ:NICK), and Managed High Yield Plus Fund Inc. (NYSE:HYF) to gather more data points.
Follow Scynexis Inc (NASDAQ:SCYX)
Follow Scynexis Inc (NASDAQ:SCYX)
Keeping this in mind, we’re going to take a gander at the fresh action surrounding SCYNEXIS Inc (NASDAQ:SCYX).
How have hedgies been trading SCYNEXIS Inc (NASDAQ:SCYX)?
When looking at the institutional investors followed by Insider Monkey, Kevin Kotler’s Broadfin Capital has the biggest position in SCYNEXIS Inc (NASDAQ:SCYX), worth close to $5.6 million, accounting for 0.3% of its total 13F portfolio. On Broadfin Capital’s heels is James E. Flynn of Deerfield Management, with a $5 million position; 0.2% of its 13F portfolio is allocated to the stock. Remaining professional money managers that are bullish include Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management, Jacob Gottlieb’s Visium Asset Management and Joseph Edelman’s Perceptive Advisors.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as SCYNEXIS Inc (NASDAQ:SCYX) but similarly valued. These stocks are Lakeland Industries, Inc. (NASDAQ:LAKE), Nicholas Financial, Inc. (NASDAQ:NICK), Managed High Yield Plus Fund Inc. (NYSE:HYF), and BRT Realty Trust (NYSE:BRT). This group of stocks’ market valuations resemble SCYX’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LAKE | 6 | 10687 | 4 |
| NICK | 4 | 8327 | -1 |
| HYF | 4 | 10617 | 0 |
| BRT | 4 | 13149 | 0 |
As you can see these stocks had an average of 4.5 hedge funds with bullish positions and the average amount invested in these stocks was $11 million. That figure was $21 million in SCYX’s case. Lakeland Industries, Inc. (NASDAQ:LAKE) is the most popular stock in this table. On the other hand Nicholas Financial, Inc. (NASDAQ:NICK) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks SCYNEXIS Inc (NASDAQ:SCYX) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.