Judging by the fact that AutoNation, Inc. (NYSE:AN) has witnessed bearish sentiment from the smart money, we can see that there exists a select few hedgies who sold off their full holdings heading into Q4. At the top of the heap, Barry Rosenstein’s JANA Partners sold off the largest stake of the “upper crust” of funds monitored by Insider Monkey, comprising close to $143.1 million in stock. Paul Marshall and Ian Wace’s fund, Marshall Wace LLP, also dropped its stock, about $10.7 million worth of AutoNation shares. These transactions are interesting, as aggregate hedge fund interest fell by 3 funds heading into Q4.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as AutoNation, Inc. (NYSE:AN) but similarly valued. We will take a look at Acadia Healthcare Company Inc (NASDAQ:ACHC), National Fuel Gas Co. (NYSE:NFG), Dolby Laboratories, Inc. (NYSE:DLB), and Allison Transmission Holdings Inc (NYSE:ALSN). This group of stocks’ market valuations match AN’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 26 hedge funds with bullish positions and the average amount invested in these stocks was $736 million. That figure was $1.17 billion in AN’s case. Allison Transmission Holdings Inc (NYSE:ALSN) is the most popular stock in this table. On the other hand National Fuel Gas Co. (NYSE:NFG) is the least popular one with only 21 bullish hedge fund positions. AutoNation, Inc. (NYSE:AN) 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 ALSN might be a better candidate to consider a long position.