Is ExlService Holdings, Inc. (EXLS) A Good Stock To Invest In?

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 Richard Driehaus’s Driehaus Capital dumped the biggest position of all the investors tracked by Insider Monkey, comprising an estimated $6.4 million in stock. Ernest Chow and Jonathan Howe’s fund, Sensato Capital Management, also said goodbye to its stock, about $3.1 million worth.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as ExlService Holdings, Inc. (NASDAQ:EXLS) but similarly valued. We will take a look at USANA Health Sciences, Inc. (NYSE:USNA), Core-Mark Holding Company, Inc. (NASDAQ:CORE), Northwest Natural Gas Co (NYSE:NWN), and Eagle Bancorp, Inc. (NASDAQ:EGBN). This group of stocks’ market valuations are closest to EXLS’s market valuation.

As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $71 million. That figure was $56 million in EXLS’s case. Eagle Bancorp, Inc. (NASDAQ:EGBN) is the most popular stock in this table. On the other hand Northwest Natural Gas Co (NYSE:NWN) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks ExlService Holdings, Inc. (NASDAQ:EXLS) is even less popular than NWN. 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.

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