Is CEVA, Inc. (CEVA) Going to Burn These Hedge Funds?: Alpha and Omega Semiconductor Ltd (AOSL), NVE Corporation (NVEC)

CEVA, Inc. (NASDAQ:CEVA) was in 11 hedge funds’ portfolio at the end of the fourth quarter of 2012. CEVA shareholders have witnessed an increase in support from the world’s most elite money managers lately. There were 9 hedge funds in our database with CEVA holdings at the end of the previous quarter.

At the moment, there are dozens of methods market participants can use to track the equity markets. Two of the most useful are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best money managers can outclass their index-focused peers by a solid margin (see just how much).

Just as beneficial, optimistic insider trading sentiment is another way to parse down the financial markets. Just as you’d expect, there are many incentives for a corporate insider to sell shares of his or her company, but just one, very simple reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if shareholders know where to look (learn more here).

Consequently, let’s take a peek at the recent action regarding CEVA, Inc. (NASDAQ:CEVA).

How have hedgies been trading CEVA, Inc. (NASDAQ:CEVA)?

At year’s end, a total of 11 of the hedge funds we track held long positions in this stock, a change of 22% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their stakes considerably.

Of the funds we track, Jim Simons’s Renaissance Technologies had the most valuable position in CEVA, Inc. (NASDAQ:CEVA), worth close to $8.8 million, accounting for less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Alkeon Capital Management, managed by Panayotis æTakisÆ Sparaggis, which held a $6.2 million position; 0.2% of its 13F portfolio is allocated to the company. Other peers with similar optimism include Ken Griffin’s Citadel Investment Group, Joel Greenblatt’s Gotham Asset Management and Joseph A. Jolson’s Harvest Capital Strategies.

Consequently, some big names were breaking ground themselves. AQR Capital Management, managed by Cliff Asness, created the largest position in CEVA, Inc. (NASDAQ:CEVA). AQR Capital Management had 0.7 million invested in the company at the end of the quarter. John Overdeck and David Siegel’s Two Sigma Advisors also initiated a $0.5 million position during the quarter. The only other fund with a new position in the stock is Charles Davidson’s Wexford Capital.

Insider trading activity in CEVA, Inc. (NASDAQ:CEVA)

Insider trading activity, especially when it’s bullish, is particularly usable when the company in focus has seen transactions within the past half-year. Over the latest 180-day time period, CEVA, Inc. (NASDAQ:CEVA) has seen zero unique insiders buying, and 1 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to CEVA, Inc. (NASDAQ:CEVA). These stocks are Alpha and Omega Semiconductor Ltd (NASDAQ:AOSL), NVE Corporation (NASDAQ:NVEC), Trina Solar Limited (ADR) (NYSE:TSL), IXYS Corporation (NASDAQ:IXYS), and GT Advanced Technologies Inc (NASDAQ:GTAT). This group of stocks belong to the semiconductor – specialized industry and their market caps are similar to CEVA’s market cap.

With the results exhibited by our studies, retail investors should always keep an eye on hedge fund and insider trading sentiment, and CEVA, Inc. (NASDAQ:CEVA) is an important part of this process.

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