Are Institutions Cutting Back Their Holdings in Curis, Inc. (NASDAQ:CRIS)?

According to the latest filings, institutions owning shares of Curis, Inc. (NASDAQ:CRIS) have decreased their positions by -15.17%.  Institutions now own 34.90% of the company.

Traders may be looking to capitalize on market trends as we move into the second part of the calendar year. Closely following the technicals might help make sense of current market conditions. Investors may choose to follow many different technical signals, or they may have picked a few popular ones to dedicate themselves to. Whatever the strategy, staying in tune with fundamentals and meaningful economic data may also prove to be highly beneficial. Coming at the equity market from multiple angles may help supply the investor with alternate perspectives that could play a vital role in the next couple of quarters.

Big organizations that control vast sums of money, such as mutual funds, insurance companies or pension funds, that buy securities are known as “institutional investors”.  Unlike individual investors, institutional investors trade in massive blocks of 10,000 or more shares per transaction.  The sheer size of these trades significantly affect the price of a share. 

PROS AND CONS

Peter Lynch says in his best-selling book, “One Up on Wall Street”, that institutional ownership is a negative thing.  “Institutions don’t own it and the analysts don’t follow it”.  He favors the stocks that big investment groups pass on because he feels that these stocks are undervalued.  In contrast, Investor’s Business Daily’s William O’Neil thinks that institutional investors are important to driving up stock prices because they provide the largest source of demand for stocks.  O’Neil argues that if a stock has no institutional ownership, it means they have already passed on it.  He regards institutional ownership as a desirable stock trait in his book, “How to Make Money in Stocks”. 

Investors often look favorably upon stocks who have a large amount of institutional ownership.  These large companies often employ a team of analysts to perform financial research before purchasing a large block of stock, making their decisions influential in the eyes of other investors.

Due to the financial commitment that these companies make into research, these institutions aren’t quick to sell off their shares.  But when they do, however, it can drive down the price. 

TECHNICAL ANALYSIS

Technical analysts have little regard for the value of a company. They use historic price data to observe stock price patterns to predict the direction of that price going forward.  Analysts use common formulas and ratios to accomplish this.

Curis, Inc. (NASDAQ:CRIS)’s RSI (Relative Strength Index) is 53.65.  RSI is a technical indicator of price momentum, comparing the size of recent gains to the size of recent losses and establishes oversold and overbought positions.

As we move into the second half of the year, investors may be focused on portfolio performance over the first part of the year. They may be trying to put all the pieces together in order to create a solid plan that will provide sustained profits, even if market conditions deteriorate. This may involve introducing more diversity into the portfolio. One investor may evaluate a stock completely different than another. It may be important to do the necessary research on the overall industry when searching for the next big winner. As the next round of earnings reporting gets underway, investors will be watching to see which companies are positioned for growth over the foreseeable future. Investors will optimally have all their requisite boxes checked when scouting out the next portfolio moves. 

Shareholders can expect a return on equity of -225.70%.  Calculated by dividing Curis, Inc.’s annual earnings by its total assets, investors will note a return on assets of -63.40%.  Finally, Curis, Inc.’s return on investment stands at -75.90% when you divide the shareholder’s return by the cost.  The consensus analysts recommendation at this point stands at 1.50 for Curis, Inc. (NASDAQ:CRIS).  This is based on a 1-5 scale where 1 indicates a Strong Buy and 5 a Strong Sell.

Disclaimer: The views, opinions, and information expressed in this article are those of the authors and do not necessarily reflect the official policy or position of any company stakeholders, financial professionals, or analysts. Examples of analysis performed within this article are only examples. They should not be utilized to make stock portfolio or financial decisions as they are based only on limited and open source information. Assumptions made within the analysis are not reflective of the position of any analysts or financial professionals.