What Do Hedge Funds Think of Legg Mason, Inc. (LM)?

Because Legg Mason, Inc. (NYSE:LM) has experienced bearish sentiment from the aggregate hedge fund industry, logic holds that there were a few funds that elected to cut their positions entirely by the end of the third quarter. Intriguingly, Millennium Management Subsidiary’s Blue Arrow Capital Management said goodbye to the biggest position of all the hedgies tracked by Insider Monkey, worth about $10.7 million in stock, and Peter Muller’s PDT Partners was right behind this move, as the fund said goodbye to about $6.1 million worth. These transactions are intriguing to say the least, as total hedge fund interest dropped by 6 funds by the end of the third quarter.

Let’s go over hedge fund activity in other stocks similar to Legg Mason, Inc. (NYSE:LM). We will take a look at Align Technology, Inc. (NASDAQ:ALGN), Ares Capital Corporation (NASDAQ:ARCC), Servicemaster Global Holdings Inc (NYSE:SERV), and Gentex Corporation (NASDAQ:GNTX). This group of stocks’ market values are closest to LM’s market value.

As you can see these stocks had an average of 27.25 hedge funds with bullish positions and the average amount invested in these stocks was $346 million. That figure was $1,240 million in LM’s case. Servicemaster Global Holdings Inc (NYSE:SERV) is the most popular stock in this table. On the other hand Ares Capital Corporation (NASDAQ:ARCC) is the least popular one with only 23 bullish hedge fund positions. Legg Mason, Inc. (NYSE:LM) 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 SERV might be a better candidate to consider a long position.