Is Bank of Montreal (USA) (BMO) A Good Stock To Buy?

Due to the fact that Bank of Montreal (USA) (NYSE:BMO) has witnessed bearish sentiment from the aggregate hedge fund industry, we can see that there exists a select few funds who were dropping their positions entirely by the end of the third quarter. At the top of the heap, Ray Carroll’s Breton Hill Capital said goodbye to the biggest position of all the hedgies monitored by Insider Monkey, comprising about $6.5 million in stock. Paul Marshall and Ian Wace’s fund, Marshall Wace LLP, also cut its stock, about $5.7 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 2 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks similar to Bank of Montreal (USA) (NYSE:BMO). These stocks are CIGNA Corporation (NYSE:CI), BCE Inc. (USA) (NYSE:BCE), Yum! Brands, Inc. (NYSE:YUM), and Avago Technologies Ltd (NASDAQ:AVGO). This group of stocks’ market values match BMO’s market value.

As you can see these stocks had an average of 55.25 hedge funds with bullish positions and the average amount invested in these stocks was $3,232 million. That figure was $202 million in BMO’s case. CIGNA Corporation (NYSE:CI) is the most popular stock in this table. On the other hand BCE Inc. (USA) (NYSE:BCE) is the least popular one with only 14 bullish hedge fund positions. Bank of Montreal (USA) (NYSE:BMO) 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 CI might be a better candidate to consider a long position.