Is Sonic Automotive Inc (SAH) A Good Stock To Buy?

Now, specific money managers have jumped into Sonic Automotive Inc (NYSE:SAH) headfirst. Elliott Management established the most outsized position in Sonic Automotive Inc (NYSE:SAH). Citadel Investment Group‘s $7.8 million position was also a new one added to its portfolio during the quarter. The other funds with brand new SAH positions are Israel Englander’s Millennium Management, Andrew Weiss’ Weiss Asset Management, and Matthew Hulsizer’s PEAK6 Capital Management.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Sonic Automotive Inc (NYSE:SAH) but similarly valued. We will take a look at Hi-Crush Partners LP (NYSE:HCLP), Tile Shop Hldgs, Inc. (NASDAQ:TTS), CenterState Banks Inc (NASDAQ:CSFL), and Continental Building Products Inc (NYSE:CBPX). This group of stocks’ market values resemble SAH’s market value.

As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $87 million. That figure was $38 million in SAH’s case. Continental Building Products Inc (NYSE:CBPX) is the most popular stock in this table. On the other hand Hi-Crush Partners LP (NYSE:HCLP) is the least popular one with only 10 bullish hedge fund positions. Sonic Automotive Inc (NYSE:SAH) 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 CBPX might be a better candidate to consider taking a long position in.

Disclosure: None