Genpact Limited (G): Are Hedge Funds Right About This Stock?

Due to the fact that Genpact Limited (NYSE:G) has witnessed falling interest from the smart money, logic holds that there were a few fund managers that slashed their positions entirely heading into Q4. At the top of the heap, Anand Parekh’s Alyeska Investment Group said goodbye to the largest stake of all the hedgies watched by Insider Monkey, totaling about $17.6 million in stock, and Aleem Mawji’s Nebula Capital was right behind this move, as the fund dropped about $5 million worth. These transactions are important to note, as aggregate hedge fund interest was cut by 5 funds heading into Q4.

Let’s now review hedge fund activity in other stocks similar to Genpact Limited (NYSE:G). These stocks are ADT Corp (NYSE:ADT), FireEye Inc (NASDAQ:FEYE), Edgewell Personal Care Company (NYSE:EPC), and Nuance Communications Inc. (NASDAQ:NUAN). This group of stocks’ market valuations match G’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ADT 22 210500 -6
FEYE 37 383976 2
EPC 34 749305 18
NUAN 30 1153747 5

As you can see these stocks had an average of 30.75 hedge funds with bullish positions and the average amount invested in these stocks was $624 million. That figure was $375 million in G’s case. FireEye Inc (NASDAQ:FEYE) is the most popular stock in this table. On the other hand ADT Corp (NYSE:ADT) is the least popular one with only 22 bullish hedge fund positions. Compared to these stocks Genpact Limited (NYSE:G) is even less popular than ADT. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, 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 warranted.