Is Markwest Energy Partners LP (MWE) A Good Stock To Buy?

As aggregate interest increased, key money managers have jumped into Markwest Energy Partners LP (NYSE:MWE) headfirst. Ivory Capital (Investment Mgmt), managed by Curtis Macnguyen, created the biggest call position in Markwest Energy Partners LP (NYSE:MWE). Ivory Capital (Investment Mgmt) had $21.5 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $15.2 million investment in the stock during the quarter. The other funds with brand new MWE positions are Nick Niell’s Arrowgrass Capital Partners, Noam Gottesman’s GLG Partners, and John Orrico’s Water Island Capital.

Let’s also examine hedge fund activity in other stocks similar to Markwest Energy Partners LP (NYSE:MWE). We will take a look at Quintiles Transnational Holdings Inc (NYSE:Q), ArcelorMittal (ADR) (NYSE:MT), Westinghouse Air Brake Technologies Corp (NYSE:WAB), and Huntington Bancshares Incorporated (NASDAQ:HBAN). All of these stocks’ market caps match MWE’s market cap.

As you can see these stocks had an average of 24.75 hedge funds with bullish positions and the average amount invested in these stocks was $277 million. That figure was $413 million in MWE’s case. Quintiles Transnational Holdings Inc (NYSE:Q) is the most popular stock in this table. On the other hand ArcelorMittal (ADR) (NYSE:MT) is the least popular one with only 18 bullish hedge fund positions. Compared to these stocks Markwest Energy Partners LP (NYSE:MWE) is even less popular than MT. 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.