Is MAXIMUS, Inc. (MMS) A Good Stock To Buy?

With a general bullishness amongst the heavyweights, key hedge funds have jumped into MAXIMUS, Inc. (NYSE:MMS) headfirst. Gotham Asset Management created the biggest position in MAXIMUS, Inc. (NYSE:MMS) which had $1.7 million invested in the company at the end of the quarter. Clinton Group also initiated a $0.9 million position during the quarter. The other funds with new positions in the stock are Ken Griffin’s Citadel Investment Group and Paul Tudor Jones’ Tudor Investment Corp.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as MAXIMUS, Inc. (NYSE:MMS) but similarly valued. These stocks are Assured Guaranty Ltd. (NYSE:AGO), GrubHub Inc (NYSE:GRUB), Bruker Corporation (NASDAQ:BRKR), and RPC, Inc. (NYSE:RES). This group of stocks’ market valuations match MMS’s market valuation.

As you can see these stocks had an average of 26 hedge funds with bullish positions and the average amount invested in these stocks was $533 million. That figure was $25 million in MMS’s case. Assured Guaranty Ltd. (NYSE:AGO) is the most popular stock in this table. On the other hand Bruker Corporation (NASDAQ:BRKR) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks MAXIMUS, Inc. (NYSE:MMS) is even less popular than BRKR. 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