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Is Agnico Eagle Mines Ltd (USA) (AEM) A Good Stock To Buy?

Judging by the fact that Agnico Eagle Mines Ltd (USA) (NYSE:AEM) has faced declining sentiment from the aggregate hedge fund industry, it’s easy to see that there exists a select few hedgies who sold off their entire stakes by the end of the third quarter. At the top of the heap, Jean-Marie Eveillard’s First Eagle Investment Management dropped the biggest position of all the hedgies watched by Insider Monkey, totaling about $750.8 million in call options, and Ken Griffin’s Citadel Investment Group was right behind this move, as the fund said goodbye to about $15.9 million worth of options. These bearish behaviors are interesting, as total hedge fund interest dropped by 4 funds by the end of the third quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Agnico Eagle Mines Ltd (USA) (NYSE:AEM) but similarly valued. These stocks are Principal Financial Group Inc (NYSE:PFG), Advance Auto Parts, Inc. (NYSE:AAP), Twitter Inc (NYSE:TWTR), and Pembina Pipeline Corp (NYSE:PBA). This group of stocks’ market values match AEM’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
PFG 15 119234 -3
AAP 62 2779651 11
TWTR 47 1080032 17
PBA 11 46092 -1

As you can see these stocks had an average of 34 hedge funds with bullish positions and the average amount invested in these stocks was $1.01 billion. That figure was $500 million in AEM’s case. Advance Auto Parts, Inc. (NYSE:AAP) is the most popular stock in this table. On the other hand Pembina Pipeline Corp (NYSE:PBA) is the least popular one with only 11 bullish hedge fund positions. Agnico Eagle Mines Ltd (USA) (NYSE:AEM) 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 AAP might be a better candidate to consider a long position.

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Disclosure: None