At the top of the heap, William C. Martin’s Raging Capital Management dumped the biggest stake of the 700 funds tracked by Insider Monkey, valued at close to $12.7 million in stock. Cliff Asness’s fund, AQR Capital Management, also dropped its stock, about $1.1 million worth. These transactions are interesting, 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 Sears Holdings Corporation (NASDAQ:SHLD) but similarly valued. These stocks are Imperva Inc (NYSE:IMPV), Whiting Petroleum Corp (NYSE:WLL), Euronav NV Ordinary Shares (NYSE:EURN), and Super Micro Computer, Inc. (NASDAQ:SMCI). This group of stocks’ market valuations match SHLD’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 $172 million. That figure was $982 million in SHLD’s case. Whiting Petroleum Corp (NYSE:WLL) is the most popular stock in this table. On the other hand Imperva Inc (NYSE:IMPV) is the least popular one with only 15 bullish hedge fund positions. Sears Holdings Corporation (NASDAQ:SHLD) 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 WLL might be a better candidate to consider a long position.