Haynes International, Inc. (HAYN): Are Hedge Funds Right About This Stock?

Since Haynes International, Inc. (NASDAQ:HAYN) has experienced falling interest from hedge fund managers, it’s easy to see that there were a few hedge funds that elected to cut their full holdings by the end of the third quarter. At the top of the heap, Ken Gray and Steve Walsh’s Bryn Mawr Capital dumped the largest position of the 700 funds tracked by Insider Monkey, valued at close to $0.5 million in stock. Peter Muller’s fund, PDT Partners, also cut its stock, about $0.3 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds by the end of the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Haynes International, Inc. (NASDAQ:HAYN) but similarly valued. These stocks are Invacare Corporation (NYSE:IVC), INTL Fcstone Inc (NASDAQ:INTL), ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS), and Chuy’s Holdings Inc (NASDAQ:CHUY). This group of stocks’ market caps resemble HAYN’s market cap.

As you can see these stocks had an average of 15 hedge funds with bullish positions and the average amount invested in these stocks was $92 million, higher than the $54 million in HAYN’s case. ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS) is the most popular stock in this table. On the other hand Invacare Corporation (NYSE:IVC) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Haynes International, Inc. (NASDAQ:HAYN) is even less popular than IVC. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.