Is Destination Maternity Corp (DEST) A Good Stock To Buy?

Because Destination Maternity Corp (NASDAQ:DEST) has faced a declination in interest from the entirety of the hedge funds we track, logic holds that there exists a select few hedge funds that decided to sell off their positions entirely last quarter. It’s worth mentioning that Cliff Asness’s AQR Capital Management said goodbye to the largest investment of the 700 funds monitored by Insider Monkey, worth close to $0.4 million in stock, and John Overdeck and David Siegel’s Two Sigma Advisors was right behind this move, as the fund cut about $0.3 million worth of shares. These transactions are interesting, as aggregate hedge fund interest dropped by 2 funds last quarter.

Let’s now review hedge fund activity in other stocks similar to Destination Maternity Corp (NASDAQ:DEST). These stocks are Southern First Bancshares, Inc. (NASDAQ:SFST), L.B. Foster Company (NASDAQ:FSTR), Summit Therapeutics PLC (ADR) (NASDAQ:SMMT), and Cenveo, Inc. (NYSE:CVO). This group of stocks’ market caps match DEST’s market cap.

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 $19 million. L.B. Foster Company (NASDAQ:FSTR) is the most popular stock in this table with 14 funds holding shares. On the other hand Southern First Bancshares, Inc. (NASDAQ:SFST) is the least popular one. With hedge funds holding stakes worth $31 million in aggregate, Destination Maternity Corp (NASDAQ:DEST) 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 FSTR might be a better candidate to consider a long position.