Should You Avoid BankUnited (BKU)?

Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that said goodbye to their entire stakes in the stock during the third quarter. It’s worth mentioning that Daniel Lascano’s Lomas Capital Management said goodbye to the largest investment of the “upper crust” of funds followed by Insider Monkey, comprising close to $7.8 million in stock. Anton Schutz’s fund, Mendon Capital Advisors, also said goodbye to its stock, about $7.7 million worth.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as BankUnited (NYSE:BKU) but similarly valued. These stocks are Spirit Airlines Incorporated (NASDAQ:SAVE), New Residential Investment Corp (NYSE:NRZ), Energizer Holdings, Inc. (NYSE:ENR), and Sensient Technologies Corporation (NYSE:SXT). All of these stocks’ market caps resemble BKU’s market cap.

As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $252 million. That figure was $332 million in BKU’s case. Spirit Airlines Incorporated (NASDAQ:SAVE) is the most popular stock in this table. On the other hand Sensient Technologies Corporation (NYSE:SXT) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks BankUnited (NYSE:BKU) is even less popular than SXT. 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