Is Korea Electric Power Corporation (ADR) (KEP) Worthy of Your Portfolio?

As aggregate interest increased, key hedge funds were breaking ground themselves. D E Shaw, led by D. E. Shaw, created the largest position in Korea Electric Power Corporation (ADR) (NYSE:KEP). D E Shaw had $1.6 million invested in the company at the end of the quarter. Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners also initiated a $0.7 million position during the quarter. The other funds with new positions in the stock are Matthew Hulsizer’s PEAK6 Capital Management and J. Alan Reid, Jr.’s Forward Management.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Korea Electric Power Corporation (ADR) (NYSE:KEP) but similarly valued. These stocks are Constellation Brands, Inc. (NYSE:STZ), Twenty-First Century Fox Inc (NASDAQ:FOXA), CME Group Inc (NASDAQ:CME), and CIGNA Corporation (NYSE:CI). All of these stocks’ market caps are closest to KEP’s market cap.

As you can see these stocks had an average of 55 hedge funds with bullish positions and the average amount invested in these stocks was $3.6 billion. That figure was $126 million in KEP’s case. Constellation Brands, Inc. (NYSE:STZ) is the most popular stock in this table. On the other hand Twenty-First Century Fox Inc (NASDAQ:FOXA) is the least popular one with only 48 bullish hedge fund positions. Compared to these stocks Korea Electric Power Corporation (ADR) (NYSE:KEP) is even less popular than FOXA. 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