We, at Insider Monkey, have gone over 700 13F filings that hedge funds and prominent investors are required to file by the government. The 13F filings show the funds’ and investors’ portfolio positions as of September 30. In this article, we look at what those funds think of Layne Christensen Company (NASDAQ:LAYN) based on that data.
Is Layne Christensen Company (NASDAQ:LAYN) a buy right now? Money managers are getting less optimistic. The number of long hedge fund positions dropped by 7 lately. At the end of this article, we will also compare Layne Christensen Company (NASDAQ:LAYN) to other stocks, including BioScrip Inc. (NASDAQ:BIOS), Harvard Bioscience, Inc. (NASDAQ:HBIO), and Alcobra Ltd (NASDAQ:ADHD) to get a better sense of its popularity.
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Follow Layne Christensen Co (NASDAQ:LAYN)
To most stock holders, hedge funds are viewed as underperforming, outdated investment vehicles of years past. While there are over 8000 funds with their doors open today, We choose to focus on the aristocrats of this group, approximately 700 funds. These money managers command the lion’s share of all hedge funds’ total capital, and by following their first-class equity investments, Insider Monkey has identified numerous investment strategies that have historically outpaced the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 12 percentage points a year for a decade in their back tests.
With all of this in mind, let’s take a gander at the new action encompassing Layne Christensen Company (NASDAQ:LAYN).
How have hedgies been trading Layne Christensen Company (NASDAQ:LAYN)?
At the end of the third quarter, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 44% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Peter Schliemann’s Rutabaga Capital Management has the most valuable position in Layne Christensen Company (NASDAQ:LAYN), worth close to $14.2 million, accounting for 1.7% of its total 13F portfolio. On Rutabaga Capital Management’s heels is Royce & Associates, led by Chuck Royce, holding a $9.7 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions include Mario Gabelli’s GAMCO Investors, David Iben’s Kopernik Global Investors, and Nelson Obus’ Wynnefield Capital.
Since Layne Christensen Company (NASDAQ:LAYN) has witnessed falling interest from the aggregate hedge fund industry, we can see that there exists a select few fund managers who sold off their full holdings heading into Q4. It’s worth mentioning that Glenn Russell Dubin’s Highbridge Capital Management said goodbye to the largest investment of the 700 funds followed by Insider Monkey, worth close to $1.2 million in stock. Peter Muller’s fund, PDT Partners, also sold off its stock, about $0.3 million worth of shares. These bearish behaviors are intriguing to say the least, as total hedge fund interest fell by 7 funds heading into Q4.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Layne Christensen Company (NASDAQ:LAYN) but similarly valued. These stocks are BioScrip Inc. (NASDAQ:BIOS), Harvard Bioscience, Inc. (NASDAQ:HBIO), Alcobra Ltd (NASDAQ:ADHD), and Destination Maternity Corp (NASDAQ:DEST). This group of stocks’ market valuations is similar to Layne Christensen Company (NASDAQ:LAYN)’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BIOS | 14 | 38623 | -1 |
| HBIO | 7 | 7536 | 1 |
| ADHD | 14 | 73966 | 2 |
| DEST | 11 | 31360 | -2 |
As you can see, these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $38 million. That figure was $46 million in Layne Christensen Company (NASDAQ:LAYN)’s case. BioScrip Inc. (NASDAQ:BIOS) is the most popular stock in this table. On the other hand, Harvard Bioscience, Inc. (NASDAQ:HBIO) is the least popular one with only 7 bullish hedge fund positions. Layne Christensen Company (NASDAQ:LAYN) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, BioScrip Inc. (NASDAQ:BIOS) might be a better candidate to consider a long position.
