Hedge Funds Are Dumping CONN’S, Inc. (CONN)

Because CONN’S, Inc. (NASDAQ:CONN) has witnessed a bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of funds that decided to sell off their entire stakes heading into Q4. At the top of the heap, Robert Pohly’s Samlyn Capital sold off the largest stake of the “upper crust” of funds monitored by Insider Monkey, valued at an estimated $57.8 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund dropped about $16.1 million worth of shares. These moves are intriguing to say the least, as aggregate hedge fund interest fell by 12 funds heading into Q4.

Let’s now review hedge fund activity in other stocks similar to CONN’S, Inc. (NASDAQ:CONN). These stocks are Heron Therapeutics Inc (NASDAQ:HRTX), iRobot Corporation (NASDAQ:IRBT), National HealthCare Corporation (NYSEMKT:NHC), and Monotype Imaging Holdings Inc. (NASDAQ:TYPE). This group of stocks’ market values are closest to CONN’S, Inc. (NASDAQ:CONN)’s market value.

As you can see, these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $164 million. That figure was $456 million in CONN’S, Inc. (NASDAQ:CONN)’s case. Heron Therapeutics Inc (NASDAQ:HRTX) is the most popular stock in this table. On the other hand, National HealthCare Corporation (NYSEMKT:NHC) is the least popular one with only 8 bullish hedge fund positions. CONN’S, Inc. (NASDAQ:CONN) 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, Heron Therapeutics Inc (NASDAQ:HRTX) might be a better candidate to consider a long position.