Should You Avoid Estee Lauder Companies Inc (EL)?

Because Estee Lauder Companies Inc (NYSE:EL) has faced a declination in interest from the smart money, logic holds that there exists a select few fund managers that slashed their entire stakes in the third quarter. It’s worth mentioning that Ken Griffin’s Citadel Investment Group cut the largest stake of the “upper crust” of funds watched by Insider Monkey, worth close to $48 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund dumped about $42.1 million worth. These moves are important to note, as aggregate hedge fund interest fell by 4 funds in the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Estee Lauder Companies Inc (NYSE:EL) but similarly valued. We will take a look at Manulife Financial Corporation (USA) (NYSE:MFC), Wipro Limited (ADR) (NYSE:WIT), Las Vegas Sands Corp. (NYSE:LVS), and Halliburton Company (NYSE:HAL). This group of stocks’ market valuations resemble EL’s market valuation.

As you can see these stocks had an average of 27.75 hedge funds with bullish positions and the average amount invested in these stocks was $1092 million. That figure was $466 million in EL’s case. Halliburton Company (NYSE:HAL) is the most popular stock in this table. On the other hand Wipro Limited (ADR) (NYSE:WIT) is the least popular one with only 7 bullish hedge fund positions. Estee Lauder Companies Inc (NYSE:EL) 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 HAL might be a better candidate to consider a long position.