Should You Buy Validus Holdings, Ltd. (VR)?

As aggregate interest increased, key hedge funds were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, initiated the largest position in Validus Holdings, Ltd. (NYSE:VR). Point72 Asset Management had $15.8 million invested in the company at the end of the quarter. Millennium Management Subsidiary’s Blue Arrow Capital Management also made a $4.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Anand Parekh’s Alyeska Investment Group, Jacob Gottlieb’s Visium Asset Management, and Michael Platt and William Reeves’s BlueCrest Capital Mgmt..

Let’s also examine hedge fund activity in other stocks similar to Validus Holdings, Ltd. (NYSE:VR). These stocks are Guidewire Software Inc (NYSE:GWRE), Colfax Corp (NYSE:CFX), CPFL Energia S.A. (ADR) (NYSE:CPL), and EPAM Systems Inc (NYSE:EPAM). This group of stocks’ market valuations match VR’s market valuation.

As you can see, these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $293 million. On the other hand, hedge funds held stakes with an aggregate value of $221 million in VR. Colfax Corp (NYSE:CFX) is the most popular stock in this table with 27 long positions, while CPFL Energia S.A. (ADR) (NYSE:CPL) is the least popular one. Validus Holdings, Ltd. (NYSE:VR) 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 CFX might be a better candidate to consider a long position.