Groupon Inc (GRPN): Are Hedge Funds Right About This Stock?

Since Groupon Inc (NASDAQ:GRPN) has experienced no change in sentiment from the aggregate hedge fund industry, therefore we take a look at a certain “tier” of money managers who sold off their entire stakes last quarter. Interestingly, Marc Majzner’s Clearline Capital cut the largest investment of the 700 funds tracked by Insider Monkey, worth about $3.7 million in stock. Steve Cohen’s family office, Point72 Asset Management, also dropped its stock, about $3.5 million worth of GRPN shares. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Groupon Inc (NASDAQ:GRPN) but similarly valued. These stocks are Balchem Corporation (NASDAQ:BCPC), Western Refining, Inc. (NYSE:WNR), Universal Forest Products, Inc. (NASDAQ:UFPI), and Hawk Corporation (NYSE:HAWK). All of these stocks’ market caps resemble GRPN’s market cap.

As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $197 million. That figure was $257 million in GRPN’s case. Hawk Corporation (NYSE:HAWK) is the most popular stock in this table. On the other hand Balchem Corporation (NASDAQ:BCPC) is the least popular one with only 8 bullish hedge fund positions. Groupon Inc (NASDAQ:GRPN) 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 HAWK might be a better candidate to consider a long position.

Disclosure: none.