Are Hedge Funds Fond of Nidec Corporation (ADR) (NJ)?

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 Nidec Corporation (ADR) (NYSE:NJ). We will take a look at Prologis Inc (NYSE:PLD), ARM Holdings plc (ADR) (NASDAQ:ARMH), Fiserv, Inc. (NASDAQ:FISV), and Aviva Plc (ADR) (NYSE:AV). This group of stocks’ market valuations are similar to NJ’s market valuation.

As you can see these stocks had an average of 15.5 hedge funds with bullish positions and the average amount invested in these stocks was $253 million. That figure was $5 million in NJ’s case. Fiserv, Inc. (NASDAQ:FISV) is the most popular stock in this table with 21 long positions. On the other hand Aviva Plc (ADR) (NYSE:AV) is the least popular one. Compared to these stocks Nidec Corporation (ADR) (NYSE:NJ) is even less popular than AV, which suggests that hedge funds aren’t very fond of this stock. Therefore, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is required.