Should You Buy Cathay General Bancorp (CATY)?

Consequently, some big names were breaking ground themselves. Millennium Management assembled the biggest position in Cathay General Bancorp (NASDAQ:CATY). Arrowstreet Capital also initiated an $6.7 million position during the quarter. The other funds with new positions in the stock are John Overdeck and David Siegel’s Two Sigma Advisors, Ken Gray and Steve Walsh’s Bryn Mawr Capital, and Matthew Tewksbury’s Stevens Capital Management.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Cathay General Bancorp (NASDAQ:CATY) but similarly valued. We will take a look at ALLETE Inc (NYSE:ALE), Ternium S.A. (ADR) (NYSE:TX), Take-Two Interactive Software, Inc. (NASDAQ:TTWO), and Cable One Inc (NYSE:CABO). This group of stocks’ market values are closest to CATY’s market value.

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 $312 million. That figure was $65 million in CATY’s case. Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is the most popular stock in this table. On the other hand ALLETE Inc (NYSE:ALE) is the least popular one with only 11 bullish hedge fund positions. Cathay General Bancorp (NASDAQ:CATY) 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 TTWO might be a better candidate to consider a long position.