Here is What Hedge Funds Think About Community Healthcare Trust Inc (CHCT)

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We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Mendon Capital Advisors. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was AQR Capital Management).

Let’s go over hedge fund activity in other stocks similar to Community Healthcare Trust Inc (NYSE:CHCT). We will take a look at InVitae Corp (NYSE:NVTA), First Connecticut Bancorp Inc (NASDAQ:FBNK), Gafisa SA (ADR) (NYSE:GFA), and Silicon Graphics International Corp (NASDAQ:SGI). All of these stocks’ market caps match CHCT’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NVTA 8 98771 0
FBNK 7 24519 -5
GFA 3 2709 0
SGI 16 64365 7

As you can see these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $48 million. That figure was $28 million in CHCT’s case. Silicon Graphics International Corp (NASDAQ:SGI) is the most popular stock in this table. On the other hand Gafisa SA (ADR) (NYSE:GFA) is the least popular one with only 3 bullish hedge fund positions. Community Healthcare Trust Inc (NYSE:CHCT) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard SGI might be a better candidate to consider taking a long position in.

Disclosure: None


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