Paylocity Holding Corp (PCTY): Are Hedge Funds Right About This Stock?

As one would reasonably expect, some big names have been driving this bullishness. Echo Street Capital Management, led by Greg Poole, initiated the most outsized position in Paylocity Holding Corp (NASDAQ:PCTY). Echo Street Capital Management had $9.8 million invested in the company at the end of the quarter. Brian Ashford-Russell and Tim Woolley’s Polar Capital also made a $4.1 million investment in the stock during the quarter. The other funds with brand new PCTY positions are Bruce Garelick’s Garelick Capital Partners, Israel Englander’s Millennium Management, and Jim Simons’ Renaissance Technologies.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Paylocity Holding Corp (NASDAQ:PCTY) but similarly valued. We will take a look at M/A-COM Technology Solutions Holdings (NASDAQ:MTSI), Matador Resources Co (NYSE:MTDR), ACI Worldwide Inc (NASDAQ:ACIW), and Nord Anglia Education Inc (NYSE:NORD). This group of stocks’ market valuations match PCTY’s market valuation.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $107 million. That figure was $72 million in PCTY’s case. M/A-COM Technology Solutions Holdings (NASDAQ:MTSI) is the most popular stock in this table. On the other hand Nord Anglia Education Inc (NYSE:NORD) is the least popular one with only 7 bullish hedge fund positions. Paylocity Holding Corp (NASDAQ:PCTY) 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 MTSI might be a better candidate to consider taking a long position in.

Disclosure: None