Medical Action Industries (NASDAQ:MDCI) shareholders have witnessed a decrease in hedge fund interest in recent months; in our experience, a stagnant interest is a bearish sign.
In the 21st century investor’s toolkit, there are dozens of gauges investors can use to monitor publicly traded companies. Some of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top hedge fund managers can outpace the broader indices by a solid margin (see just how much).
Just as beneficial, optimistic insider trading activity is another way to break down the stock market universe. As the old adage goes: there are a variety of reasons for a corporate insider to drop shares of his or her company, but just one, very obvious reason why they would buy. Several empirical studies have demonstrated the useful potential of this strategy if investors understand where to look (learn more here).
With these “truths” under our belt, it’s important to take a peek at the recent action regarding Medical Action Industries (NASDAQ:MDCI).
How have hedgies been trading Medical Action Industries (NASDAQ:MDCI)?
At year’s end, a total of 6 of the hedge funds we track were bullish in this stock, a change of 0% from the third quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their holdings meaningfully.
Seeing as Medical Action Industries (NASDAQ:MDCI) has faced falling interest from the entirety of the hedge funds we track, it’s easy to see that there exists a select few hedge funds that elected to cut their positions entirely at the end of the year. Interestingly, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners dropped the largest investment of the 450+ funds we track, comprising an estimated $0.1 million in stock. These bearish behaviors are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider trading activity in Medical Action Industries (NASDAQ:MDCI)
Bullish insider trading is particularly usable when the company we’re looking at has seen transactions within the past half-year. Over the last half-year time period, Medical Action Industries (NASDAQ:MDCI) has experienced 1 unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Medical Action Industries (NASDAQ:MDCI). These stocks are Solta Medical Inc (NASDAQ:SLTM), Zeltiq Aesthetics Inc (NASDAQ:ZLTQ), EDAP TMS S.A. (ADR) (NASDAQ:EDAP), Synergetics USA Inc (NASDAQ:SURG), and Rockwell Medical Inc (NASDAQ:RMTI). All of these stocks are in the medical appliances & equipment industry and their market caps resemble MDCI’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Solta Medical Inc (NASDAQ:SLTM) | 6 | 0 | 1 |
| Zeltiq Aesthetics Inc (NASDAQ:ZLTQ) | 4 | 0 | 1 |
| EDAP TMS S.A. (ADR) (NASDAQ:EDAP) | 1 | 0 | 0 |
| Synergetics USA Inc (NASDAQ:SURG) | 4 | 1 | 0 |
| Rockwell Medical Inc (NASDAQ:RMTI) | 3 | 0 | 1 |
With the returns shown by our studies, retail investors should always keep an eye on hedge fund and insider trading activity, and Medical Action Industries (NASDAQ:MDCI) applies perfectly to this mantra.
