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Comparing smart money buying trends to stock performance can lead to some interesting results.

We ran a screen on technically oversold stocks (with RSI(14) below 40) that are also highly shorted. We screened these stocks for those with significant net institutional buying interest over the current quarter.

Either hedge funds called it wrong on these names, or they know something the market hasn’t realized yet – which do you think is the case?

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 (NYSEARCA:SPY) index over the last month.

(Click chart for more detail)


Use this list as a starting-off point for your own analysis.

List sorted by net institutional shares purchased as a percent of share float.

1. Ancestry.com Inc. (NASDAQ:ACOM): Operates as an online resource for family history for subscribers worldwide. Market cap of $1.04B. RSI(14) at 39.06. Float short at 12.96%. Net institutional shares purchased over the current quarter at 9.4M, which is 29.82% of the company's 31.52M share float. The stock is currently stuck in a downtrend, trading 6.56% below its SMA20, 19.69% below its SMA50, and 33.79% below its SMA200. It's been a rough couple of days for the stock, losing 7.81% over the last week.

2. Veeco Instruments Inc. (NASDAQ:VECO): Designs, manufactures, and markets equipment to make high brightness light emitting diodes (HB LEDs), solar panels, hard-disk drives, and other devices. Market cap of $1.04B. RSI(14) at 39.71. Float short at 26.28%. Net institutional shares purchased over the current quarter at 4.8M, which is 13.59% of the company's 35.33M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.58). The stock is a short squeeze candidate, with a short float at 26.28% (equivalent to 5.79 days of average volume). The stock is currently stuck in a downtrend, trading 5.82% below its SMA20, 19.01% below its SMA50, and 41.85% below its SMA200. The stock has performed poorly over the last month, losing 14.32%.

3. Canadian Solar Inc. (NASDAQ:CSIQ): Engages in the design, development, manufacture, and sale of solar power products in Canada and internationally. Market cap of $138.43M. RSI(14) at 33.42. Float short at 19.77%. Net institutional shares purchased over the current quarter at 2.7M, which is 9.06% of the company's 29.81M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 3.31). The stock is a short squeeze candidate, with a short float at 19.77% (equivalent to 7.21 days of average volume). The stock is currently stuck in a downtrend, trading 18.17% below its SMA20, 40.12% below its SMA50, and 67.73% below its SMA200. It's been a rough couple of days for the stock, losing 9.92% over the last week.

4. China Lodging Group, Limited (NASDAQ:HTHT): Develops, operates, and manages a chain of hotels in the People's Republic of China. Market cap of $779.55M. RSI(14) at 35.69. Float short at 13.81%. Net institutional shares purchased over the current quarter at 1.9M, which is 8.31% of the company's 22.86M share float. The stock is a short squeeze candidate, with a short float at 13.81% (equivalent to 11.37 days of average volume). The stock is currently stuck in a downtrend, trading 8.1% below its SMA20, 16.46% below its SMA50, and 28.79% below its SMA200. It's been a rough couple of days for the stock, losing 6.24% over the last week.

5. First Solar, Inc. (NASDAQ:FSLR): Manufactures and sells solar modules using a thin-film semiconductor technology. Market cap of $4.83B. RSI(14) at 34.67. Float short at 34.58%. Net institutional shares purchased over the current quarter at 4.8M, which is 8.07% of the company's 59.47M share float. The stock is a short squeeze candidate, with a short float at 34.58% (equivalent to 7.67 days of average volume). The stock is currently stuck in a downtrend, trading 11.72% below its SMA20, 32.01% below its SMA50, and 54.75% below its SMA200. The stock has performed poorly over the last month, losing 33.37%.

6. Eastman Kodak Co. (EK): Provides imaging technology products and services to the photographic and graphic communications markets worldwide. Market cap of $352.46M. RSI(14) at 38.08. Float short at 29.29%. Net institutional shares purchased over the current quarter at 19.7M, which is 7.35% of the company's 267.95M share float. The stock is currently stuck in a downtrend, trading 17.82% below its SMA20, 42.22% below its SMA50, and 58.29% below its SMA200. It's been a rough couple of days for the stock, losing 7.09% over the last week.

7. DepoMed Inc. (NASDAQ:DEPO): Develops and commercializes pharmaceutical products based on its proprietary oral drug delivery technologies in the United States. Market cap of $249.67M. RSI(14) at 38.04. Float short at 10.29%. Net institutional shares purchased over the current quarter at 3.4M, which is 7.33% of the company's 46.38M share float. The stock is a short squeeze candidate, with a short float at 10.29% (equivalent to 6.16 days of average volume). The stock is currently stuck in a downtrend, trading 18.62% below its SMA20, 19.91% below its SMA50, and 40.73% below its SMA200. It's been a rough couple of days for the stock, losing 26.31% over the last week.

8. Xenoport, Inc. (NASDAQ:XNPT): Focuses on developing and commercializing internally discovered product candidates that utilize the body's natural nutrient transport mechanisms to enhance the therapeutic benefits of drugs. Market cap of $194.57M. RSI(14) at 38.56. Float short at 10.50%. Net institutional shares purchased over the current quarter at 2.1M, which is 6.58% of the company's 31.93M share float. The stock is a short squeeze candidate, with a short float at 10.5% (equivalent to 10.52 days of average volume). The stock is currently stuck in a downtrend, trading 7.64% below its SMA20, 15.85% below its SMA50, and 24.74% below its SMA200. The stock has performed poorly over the last month, losing 19.15%.

9. Advanced Micro Devices, Inc. (NYSE:AMD): Operates as a semiconductor company in the United States, Japan, China, and Europe. Market cap of $3.34B. RSI(14) at 37.87. Float short at 13.66%. Net institutional shares purchased over the current quarter at 37.8M, which is 6.48% of the company's 583.28M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.15). The stock is currently stuck in a downtrend, trading 10.38% below its SMA20, 20.24% below its SMA50, and 36.43% below its SMA200. The stock has performed poorly over the last month, losing 30.2%.

*Institutional data sourced from Fidelity, all other data sourced from Finviz.


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 9 Oversold, Highly Shorted Stocks Being Bought Up By Hedge Funds