Should You Consider Cavco Industries, Inc. (CVCO)?

Seeing as Cavco Industries, Inc. (NASDAQ:CVCO) has witnessed a declination in interest from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of funds who sold off their entire stakes in the third quarter. Interestingly, Israel Englander’s Millennium Management dropped the largest stake of the “upper crust” of funds monitored by Insider Monkey, totaling about $1.9 million in stock, and Ken Grossman and Glen Schneider’s SG Capital Management was right behind this move, as the fund dumped about $1.9 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest was cut by 4 funds in the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Cavco Industries, Inc. (NASDAQ:CVCO) but similarly valued. We will take a look at Materion Corp (NYSE:MTRN), Quad/Graphics, Inc. (NYSE:QUAD), Great Southern Bancorp, Inc. (NASDAQ:GSBC), and Movado Group, Inc (NYSE:MOV). All of these stocks’ market caps are closest to CVCO’s market cap.

As you can see these stocks had an average of 13.75 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $154 million in CVCO’s case. Quad/Graphics, Inc. (NYSE:QUAD) is the most popular stock in this table. On the other hand Great Southern Bancorp, Inc. (NASDAQ:GSBC) is the least popular one with only 4 bullish hedge fund positions. Cavco Industries, Inc. (NASDAQ:CVCO) 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 MOV might be a better candidate to consider a long position.