Hedge Funds Are Selling Franklin Electric Co. (FELE)

Due to the fact that Franklin Electric Co. (NASDAQ:FELE) has experienced falling interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of hedge funds that decided to sell off their full holdings heading into Q4. It’s worth mentioning that Ken Griffin’s Citadel Investment Group dumped the biggest stake of all the hedgies studied by Insider Monkey, valued at close to $2 million in stock, and Millennium Management, one of the 10 largest hedge funds in the world, was right behind this move, as the fund said goodbye to about $0.8 million worth of shares.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Franklin Electric Co. (NASDAQ:FELE) but similarly valued. We will take a look at G&K Services Inc (NASDAQ:GK), Advanced Energy Industries, Inc. (NASDAQ:AEIS), Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX), and HMS Holdings Corp. (NASDAQ:HMSY). This group of stocks’ market caps resemble FELE’s market cap.

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 $133 million. That figure was $127 million in FELE’s case. HMS Holdings Corp. (NASDAQ:HMSY) is the most popular stock in this table. On the other hand G&K Services Inc (NASDAQ:GK) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Franklin Electric Co. (NASDAQ:FELE) is even less popular than GK. 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.

Disclosure: None