Hedge Funds Aren’t Crazy About The Coca-Cola Company (KO) Anymore

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Judging by the fact that The Coca-Cola Company (NYSE:KO) has experienced falling interest from hedge fund managers, it’s easy to see that there lies a certain “tier” of funds that elected to cut their entire stakes in the third quarter. Intriguingly, Peter Muller’s PDT Partners dropped the biggest investment of all the hedgies watched by Insider Monkey, valued at close to $50.9 million in call options. James Dinan’s fund, York Capital Management, also dropped its call options, about $39.2 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest fell by 8 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as The Coca-Cola Company (NYSE:KO) but similarly valued. These stocks are The Walt Disney Company (NYSE:DIS), Anheuser-Busch InBev NV (ADR) (NYSE:BUD), Bank of America Corp (NYSE:BAC), and Nippon Telegraph & Telephone Corp (ADR) (NYSE:NTT). All of these stocks’ market caps are closest to KO’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DIS 48 3367786 -12
BUD 49 5338832 8
BAC 108 6448158 13
NTT 12 133784 4

As you can see these stocks had an average of 54 hedge funds with bullish positions and the average amount invested in these stocks was $3.82 billion. Bank of America Corp (NYSE:BAC) is the most popular stock in this table, while, Nippon Telegraph & Telephone Corp (ADR) (NYSE:NTT) is the least popular one with only 12 bullish hedge fund positions. The Coca-Cola Company (NYSE:KO) is not the least popular stock in this group, but hedge fund interest is still below average. On the other hand, the funds we track have amassed $19.33 billion worth of the company’s stock. Considering that, despite the decline, Coca-Cola still is a popular pick among hedge funds and enjoys the support of some of the best investors in the world, it may be a good idea to take a closer look at the company. However, we prefer to look into stocks that hedge funds are collectively the most bullish on, such as Bank of America, in this case.

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