Is Leggett & Platt, Inc. (LEG) A Good Stock To Buy?

As aggregate interest increased, key hedge funds have jumped into Leggett & Platt, Inc. (NYSE:LEG) headfirst. Two Sigma Advisors established the most outsized position in Leggett & Platt, Inc. (NYSE:LEG). Two Sigma Advisors had $11.2 million invested in the company at the end of the quarter. George Hall’s Clinton Group also made a $7.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Chuck Royce’s Royce & Associates, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Glenn Russell Dubin’s Highbridge Capital Management.

Let’s also examine hedge fund activity in other stocks similar to Leggett & Platt, Inc. (NYSE:LEG). These stocks are Gildan Activewear Inc (USA) (NYSE:GIL), Fluor Corporation (NEW) (NYSE:FLR), The Goodyear Tire & Rubber Company (NASDAQ:GT), and VimpelCom Ltd (ADR) (NYSE:VIP). This group of stocks’ market values are closest to LEG’s market value.

As you can see these stocks had an average of 23.5 hedge funds with bullish positions and the average amount invested in these stocks was $569 million. That figure was $123 million in LEG’s case. The Goodyear Tire & Rubber Company (NASDAQ:GT) is the most popular stock in this table. On the other hand Gildan Activewear Inc (USA) (NYSE:GIL) is the least popular one with only 10 bullish hedge fund positions. Leggett & Platt, Inc. (NYSE:LEG) 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 GT might be a better candidate to consider a long position.

Disclosure: None