Hedge Funds Are Getting Burned by Natural Grocers by Vitamin Cottage Inc (NGVC)

As industrywide interest jumped, key money managers were leading the bulls’ herd. D E Shaw, founded by David E. Shaw, created the most outsized position in Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC). D E Shaw had $0.7 million invested in the company at the end of the quarter. Ken Gray and Steve Walsh’s Bryn Mawr Capital also initiated a $0.5 million position during the quarter. The only other fund with a new position in the stock is Chao Ku’s Nine Chapters Capital Management.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC) but similarly valued. We will take a look at Tronox Ltd (NYSE:TROX), HomeStreet Inc (NASDAQ:HMST), First Trust High Income Long/short Fund (NYSE:FSD), and SunCoke Energy, Inc (NYSE:SXC). This group of stocks’ market valuations match NGVC’s market valuation.

As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $66 million. That figure was $14 million in NGVC’s case. SunCoke Energy, Inc (NYSE:SXC) is the most popular stock in this table. On the other hand First Trust High Income Long/short Fund (NYSE:FSD) is the least popular one with only 6 bullish hedge fund positions. Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC) 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 SXC might be a better candidate to consider a long position in.