Is Tarena International Inc(ADR) (TEDU) A Good Stock To Buy?

Because Tarena International Inc (ADR) (NASDAQ:TEDU) has witnessed falling interest from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of fund managers that elected to cut their full holdings heading into Q4. Interestingly, Emanuel J. Friedman’s EJF Capital dumped the largest investment of the 700 funds watched by Insider Monkey, totaling close to $1.6 million in stock, and Jim Simons’s Renaissance Technologies was right behind this move, as the fund sold off about $0.4 million worth of TEDU shares. These transactions are intriguing to say the least, as total hedge fund interest fell by 2 funds heading into Q4.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Tarena International Inc (ADR) (NASDAQ:TEDU) but similarly valued. These stocks are Winthrop Realty Trust (NYSE:FUR), CBIZ, Inc. (NYSE:CBZ), Shopify Inc (NYSE:SHOP), and Francesca’s Holdings Corp (NASDAQ:FRAN). This group of stocks’ market caps match TEDU’s market cap.

As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $96 million. That figure was a meager $8 million in TEDU’s case. Winthrop Realty Trust (NYSE:FUR) is the most popular stock in this table, while Shopify Inc (NYSE:SHOP) is the laggard with only 10 bullish hedge fund positions. Compared to these stocks Tarena International Inc (ADR) (NASDAQ:TEDU) is even less popular than SHOP. 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.