NPS Pharmaceuticals, Inc. (NPSP): Hedge Funds Are Bullish and Insiders Are Undecided, What Should You Do?

In today’s marketplace, there are tons of gauges market participants can use to track their holdings. A duo of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outclass the broader indices by a solid margin (see just how much).

Equally as necessary, positive insider trading activity is a second way to look at the financial markets. Obviously, there are lots of motivations for an executive to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many empirical studies have demonstrated the valuable potential of this method if piggybackers know what to do (learn more here).

Furthermore, it’s important to examine the newest info about NPS Pharmaceuticals, Inc. (NASDAQ:NPSP).

How have hedgies been trading NPS Pharmaceuticals, Inc. (NASDAQ:NPSP)?

At Q2’s end, a total of 19 of the hedge funds we track held long positions in this stock, a change of 6% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were upping their holdings significantly.

When using filings from the hedgies we track, Sectoral Asset Management, managed by Jerome Pfund and Michael Sjostrom, holds the most valuable position in NPS Pharmaceuticals, Inc. (NASDAQ:NPSP). Sectoral Asset Management has a $34.8 million position in the stock, comprising 1% of its 13F portfolio. On Sectoral Asset Management’s heels is Broadfin Capital, managed by Kevin Kotler, which held a $25.6 million position; 5% of its 13F portfolio is allocated to the stock. Other peers that hold long positions include Israel Englander’s Millennium Management, John Overdeck and David Siegel’s Two Sigma Advisors and Joseph Edelman’s Perceptive Advisors.

As aggregate interest spiked, specific money managers were leading the bulls’ herd. Sectoral Asset Management, managed by Jerome Pfund and Michael Sjostrom, assembled the most valuable position in NPS Pharmaceuticals, Inc. (NASDAQ:NPSP). Sectoral Asset Management had 34.8 million invested in the company at the end of the quarter. Kevin Kotler’s Broadfin Capital also made a $25.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Israel Englander’s Millennium Management, John Overdeck and David Siegel’s Two Sigma Advisors, and Joseph Edelman’s Perceptive Advisors.

How have insiders been trading NPS Pharmaceuticals, Inc. (NASDAQ:NPSP)?

Bullish insider trading is most useful when the primary stock in question has seen transactions within the past six months. Over the last six-month time frame, NPS Pharmaceuticals, Inc. (NASDAQ:NPSP) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to NPS Pharmaceuticals, Inc. (NASDAQ:NPSP). These stocks are MannKind Corporation (NASDAQ:MNKD), Puma Biotechnology Inc (NYSE:PBYI), Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN), Celldex Therapeutics, Inc. (NASDAQ:CLDX), and Exelixis, Inc. (NASDAQ:EXEL). This group of stocks belong to the biotechnology industry and their market caps resemble NPSP’s market cap.

Using the results demonstrated by our analyses, regular investors must always keep one eye on hedge fund and insider trading activity, and NPS Pharmaceuticals, Inc. (NASDAQ:NPSP) shareholders fit into this picture quite nicely.

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