Advantage Oil & Gas Ltd (USA) (AAV): Hedge Fund Sentiment Unchanged

We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Millennium Management. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Citadel Investment Group).

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Advantage Oil & Gas Ltd (USA) (NYSE:AAV) but similarly valued. These stocks are Infinera Corp. (NASDAQ:INFN), Natus Medical Inc (NASDAQ:BABY), CVR Refining LP (NYSE:CVRR), and Flow International Corporation (NASDAQ:FLOW). All of these stocks’ market caps are similar to AAV’s market cap.

As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $87 million. That figure was $13 million in AAV’s case. Infinera Corp. (NASDAQ:INFN) is the most popular stock in this table. On the other hand CVR Refining LP (NYSE:CVRR) is the least popular one with only 6 bullish hedge fund positions. Advantage Oil & Gas Ltd (USA) (NYSE:AAV) 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 INFN might be a better candidate to consider taking a long position in.

Disclosure: None