Should You Avoid W&T Offshore, Inc. (WTI)?

Because W&T Offshore, Inc. (NYSE:WTI) has faced a declining sentiment from the aggregate hedge fund industry, we can see that there was a specific group of hedge funds who were dropping their positions entirely in the third quarter. Interestingly, GLG Partners said goodbye to the biggest stake of all the hedgies monitored by Insider Monkey, worth an estimated $1.1 million in stock, and Sander Gerber’s Hudson Bay Capital Management was right behind this move, as the fund sold off about $1.1 million worth of shares. These transactions are important to note, as total hedge fund interest was cut by 7 funds in the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as W&T Offshore, Inc. (NYSE:WTI) but similarly valued. These stocks are Magnachip Semiconductor Corp (NYSE:MX), Xactly Corp (NYSE:XTLY), Credit Suisse High Yield Bond Fund (ETF) (NYSEMKT:DHY), and Black Box Corporation (NASDAQ:BBOX). This group of stocks’ market valuations match W&T Offshore, Inc. (NYSE:WTI)’s market valuation.

As you can see, these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $39 million. That figure was $20 million in W&T Offshore, Inc. (NYSE:WTI)’s case. Magnachip Semiconductor Corp (NYSE:MX) is the most popular stock in this table. On the other hand, Xactly Corp (NYSE:XTLY) is the least popular one with only 4 bullish hedge fund positions. W&T Offshore, Inc. (NYSE:WTI) 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, Magnachip Semiconductor Corp (NYSE:MX) might be a better candidate to consider a long position.