SK Telecom Co., Ltd. (ADR) (SKM): Are Hedge Funds Right About This Stock?

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s check out hedge fund activity in other stocks similar to SK Telecom Co., Ltd. (ADR) (NYSE:SKM). We will take a look at Alliance Data Systems Corporation (NYSE:ADS), Northern Trust Corporation (NASDAQ:NTRS), Liberty Interactive Corp (NASDAQ:QVCA), and International Paper Company (NYSE:IP). This group of stocks’ market valuations match SKM’s market valuation.

As you can see these stocks had an average of 37 hedge funds with bullish positions and the average amount invested in these stocks was $1388 million. That figure was $86 million in SKM’s case. Liberty Interactive Corp (NASDAQ:QVCA) is the most popular stock in this table, while the least popular one is Northern Trust Corporation (NASDAQ:NTRS). In comparison, SK Telecom Co., Ltd. (ADR) (NYSE:SKM) with 7 bullish hedge fund positions, is even less popular than NTRS, which makes it the stock with the least hedge fund interest in this group. It is possible that the smart money isn’t’ behind this stock because investors consider it overpriced, due to them not being familiar with the bullish thesis. In either case, further detailed research is needed.