Is Chemed Corporation (CHE) Going to Burn These Hedge Funds?

Due to the fact that Chemed Corporation (NYSE:CHE) has encountered falling interest from hedge fund managers, it’s safe to say that there is a sect of hedgies who sold off their positions entirely last quarter. Interestingly, Paul Marshall and Ian Wace’s Marshall Wace LLP cashed in the biggest investment of all the hedgies followed by Insider Monkey, valued at close to $5.5 million in stock, and Michael Platt and William Reeves’ BlueCrest Capital Mgmt. was right behind this move, as the fund dropped about $0.8 million worth of shares.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Chemed Corporation (NYSE:CHE) but similarly valued. These stocks are Clear Channel Outdoor Holdings, Inc. (NYSE:CCO), WebMD Health Corp. (NASDAQ:WBMD), Cepheid (NASDAQ:CPHD), and New Gold Inc. (USA) (NYSEAMEX:NGD). This group of stocks’ market values are closest to CHE’s market value.

As you can see these stocks had an average of 23 hedge funds with bullish positions and the average amount invested in these stocks was $292 million. That figure was $244 million in CHE’s case. Cepheid (NASDAQ:CPHD) is the most popular stock in this table. On the other hand New Gold Inc. (USA) (NYSEAMEX:NGD) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks Chemed Corporation (NYSE:CHE) is even less popular than NGD. 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