Weight Watchers International, Inc. (WTW)’s Shares Putting A Lot Of Weight On Amid Takeover Rumors

How have hedgies been trading Weight Watchers International, Inc. (NYSE:WTW)?

Heading into the second quarter, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 18% from the fourth quarter. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were increasing their holdings significantly.

When looking at the hedgies followed by Insider Monkey, Philip Rosenstrach’s Pomelo Capital had the most valuable position in Weight Watchers International, Inc. (NYSE:WTW), worth close to $6.3 million and 900,000 shares, amounting to 3.4% of its total 13F portfolio. Sitting at the No. 2 spot is Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital, with a $4.4 million position holding 626,860 shares; less than 0.1%% of its 13F portfolio is allocated to the company. Some other hedge funds with similar optimism comprise Anand Parekh’s Alyeska Investment Group, and John Burbank’s Passport Capital.

Judging by the fact that Weight Watchers International, Inc. (NYSE:WTW) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there is a sect of hedgies who sold off their entire stakes heading into the second quarter. It’s worth mentioning that Conan Laughlin’s North Tide Capital sold off the biggest stake of the “upper crust” of funds monitored by Insider Monkey, worth an estimated $42.2 million in stock. Stephen DuBois’s fund, Camber Capital Management also cut its position, of about $28.5 million worth of shares. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by four funds heading into the second quarter.

If a sale materializes between the activist investor and the majority shareholder of the company, it could create very big shareholder value. As such, and given its rock-bottom price anyway, we feel safe in recommending a buy of Weight Watchers at its current price.

Disclosure: None