Recent insider trends for Cavium, Inc. (NASDAQ:CAVM) have caught the attention of investors. Analysts study insider data to get a sense of sense of what key shareholders think about the outlook for a particular stock. In the case of CAVM, the data has some interesting implications for where the stock might be headed.
Institutions own 99.92% of Cavium, Inc. (CAVM)’s shares. The total value of these holdings, in millions, is $4,690. Among active positions in the latest quarter, 137 holders increased their positions by a total of 6.73 million shares, 115 holders decreased the positions by a total of 10.51 million shares, and 32 holders held their positions. This works out to a net decrease in ownership of 3.78 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 46 holders initiated new positions by a total of 1.16 million shares and 32 holders exited their positions by a total of 1.6 million shares. This nets out to a decrease of 434004 shares and is another bearish sign for CAVM.
In the last three months, insiders executed a total of 1 trades. 0 of these were buys and 1 were sells. Insider ownership decreased by a total of 20000 shares, which suggests that CAVM’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 15 buys and 15 sells, and ownership decreased by a net of 210388 shares.
Comparing the number of shares sold short over time is a method analysts often use to get a reading on investor sentiment. Cavium, Inc. (NASDAQ:CAVM)’s short interest is 5.58 million shares, or 8.50% of the float. This represents an increase of 3% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
Ownership trends and trading patterns can be useful tools for predicting a stock’s performance, but it’s also important to consider the technicals in order to form a more comprehensive view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that CAVM is a Strong buy, which implies that CAVM is expected to outperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Cavium, Inc. (NASDAQ:CAVM) is undervalued.