Hedge Funds Are Dumping Universal Forest Products, Inc. (UFPI): What Are They Afraid Of?

Due to the fact that Universal Forest Products, Inc. (NASDAQ:UFPI) has gone through falling interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of money managers that slashed their entire stakes heading into Q4. Interestingly, Drew Cupps’ Cupps Capital Management said goodbye to the largest position of the 700 funds tracked by Insider Monkey, worth close to $0.9 million in stock, and Ken Griffin’s Citadel Investment Group was right behind this move, as the fund dumped about $0.5 million worth of shares.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Universal Forest Products, Inc. (NASDAQ:UFPI) but similarly valued. We will take a look at Hawk Corporation (NYSE:HAWK), Grand Canyon Education Inc (NASDAQ:LOPE), Abengoa Yield PLC (NASDAQ:ABY), and EverBank Financial Corp (NYSE:EVER). This group of stocks’ market valuations are closest to UFPI’s market valuation.

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 $339 million. That figure was $83 million in UFPI’s case. Hawk Corporation (NYSE:HAWK) is the most popular stock in this table. On the other hand Abengoa Yield PLC (NASDAQ:ABY) is the least popular one with only 13 bullish hedge fund positions. Universal Forest Products, Inc. (NASDAQ:UFPI) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard HAWK might be a better candidate to consider taking a long position in.

Disclosure: None