Is Smart & Final Stores Inc (SFS) a Good Stock to Buy?

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With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Portolan Capital Management initiated the biggest position in Smart & Final Stores Inc (NYSE:SFS). Portolan Capital Management had $2.7 million invested in the company at the end of the quarter. Mike Vranos’ Ellington also made a $0.2 million investment in the stock during the quarter. The other funds with brand new SFS positions are Matthew Hulsizer’s PEAK6 Capital Management.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Smart & Final Stores Inc (NYSE:SFS) but similarly valued. These stocks are MiMedx Group Inc (NASDAQ:MDXG), Compass Diversified Holdings (NYSE:CODI), Maiden Holdings, Ltd. (NASDAQ:MHLD), and Zhaopin Ltd (ADR) (NYSE:ZPIN). This group of stocks’ market valuations are closest to SFS’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MDXG 7 13927 -3
CODI 6 7828 -1
MHLD 13 41771 3
ZPIN 4 8590 -2

As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $18 million. That figure was $69 million in SFS’s case. Maiden Holdings, Ltd. (NASDAQ:MHLD) is the most popular stock in this table. On the other hand Zhaopin Ltd (ADR) (NYSE:ZPIN) is the least popular one with only 4 bullish hedge fund positions. Smart & Final Stores Inc (NYSE:SFS) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard MHLD might be a better candidate to consider taking a long position in.

Disclosure: None


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