Hedge Funds Are Crazy About SM Energy Co (SM)

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As industry-wide interest jumped, key hedge funds have jumped into SM Energy Co (NYSE:SM) headfirst. Discovery Capital Management initiated the biggest position in SM Energy Co (NYSE:SM). Discovery Capital Management had $29.6 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $16.9 million position during the quarter. The following funds were also among the new SM investors: Kenneth Tropin’s Graham Capital Management, Todd J. Kantor’s Encompass Capital Advisors, and Robert Vollero and Gentry T. Beach’s Vollero Beach Capital Partners.

Let’s now take a look at hedge fund activity in other stocks similar to SM Energy Co (NYSE:SM). We will take a look at Matthews International Corp (NASDAQ:MATW), MasTec, Inc. (NYSE:MTZ), Vishay Intertechnology (NYSE:VSH), and Intersil Corp (NASDAQ:ISIL). This group of stocks’ market valuations match SM’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MATW 10 22075 3
MTZ 23 294067 0
VSH 17 272131 3
ISIL 30 318563 16

As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $227 million. That figure was $322 million in SM’s case. Intersil Corp (NASDAQ:ISIL) is the most popular stock in this table. On the other hand Matthews International Corp (NASDAQ:MATW) is the least popular one with only 10 bullish hedge fund positions. SM Energy Co (NYSE:SM) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal, as we’d rather spend our time researching stocks that hedge funds are piling on. In this regard both ISIL and SM might be good candidates to consider long positions in.

Disclosure: None

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