Is Energy Transfer Equity, L.P. (ETE) A Good Stock To Buy?

Due to the fact that Energy Transfer Equity, L.P. (NYSE:ETE) has experienced declining sentiment from hedge fund managers, it’s easy to see that there lies a certain “tier” of money managers who sold off their positions entirely last quarter. Interestingly, James Dinan’s York Capital Management sold off the largest investment of the 700 funds watched by Insider Monkey, totaling an estimated $162.3 million in stock. Robert Boucai’s fund, Newbrook Capital Advisors, also dumped its stock, about $40.3 million worth. These moves are important to note, as total hedge fund interest dropped by 6 funds last quarter.

Let’s now review hedge fund activity in other stocks similar to Energy Transfer Equity, L.P. (NYSE:ETE). These stocks are Koninklijke Philips Electronics NV (ADR) (NYSE:PHG), Delphi Automotive PLC (NYSE:DLPH), Dollar General Corp. (NYSE:DG), and Baxalta Inc (NYSE:BXLT). This group of stocks’ market values are closest to ETE’s market value.

As you can see these stocks had an average of 34 hedge funds with bullish positions and the average amount invested in these stocks was $866 million, versus $710 million in ETE’s case. Dollar General Corp. (NYSE:DG) is the most popular stock in this table. On the other hand Koninklijke Philips Electronics NV (ADR) (NYSE:PHG) is the least popular one with only 8 bullish hedge fund positions. Energy Transfer Equity, L.P. (NYSE:ETE) 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 DG might be a better candidate to consider a long position.