Is Alamo Group, Inc. (ALG) A Good Stock To Buy?

We already know that not all hedge funds are bullish on the stock and some hedge funds actually dumped their positions entirely. It’s worth mentioning that Renaissance Technologies, one of the largest hedge funds in the world dumped the biggest position of all the hedgies monitored by Insider Monkey, comprising an estimated $1 million in stock. David Costen Haley’s fund, HBK Investments, also cut its stock, about $0.4 million worth.

Let’s check out hedge fund activity in other stocks similar to Alamo Group, Inc. (NYSE:ALG). These stocks are Bob Evans Farms Inc (NASDAQ:BOBE), Virtus Investment Partners Inc (NASDAQ:VRTS), Saia Inc (NASDAQ:SAIA), and City Holding Company (NASDAQ:CHCO). This group of stocks’ market valuations are similar to ALG’s market valuation.

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $80 million. That figure was $148 million in ALG’s case. Bob Evans Farms Inc (NASDAQ:BOBE) is the most popular stock in this table. On the other hand Saia Inc (NASDAQ:SAIA) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Alamo Group, Inc. (NYSE:ALG) is even less popular than SAIA. 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