Is Alliance Resource Partners, L.P. (ARLP) A Good Stock to Buy?

Seeing as Alliance Resource Partners, L.P. (NASDAQ:ARLP) has gone through falling interest from the aggregate hedge fund industry, it’s easy to see that there were a few hedge funds who sold off their entire stakes by the end of the third quarter. Intriguingly, Renaissance Technologies, one of the largest hedge funds in the world, cut the largest position of the 700 funds studied by Insider Monkey, totaling an estimated $2.4 million in stock. Joshua Packwood and Schuster Tanger’s fund, Radix Partners, also sold off its stock, about $0.3 million worth.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Alliance Resource Partners, L.P. (NASDAQ:ARLP) but similarly valued. We will take a look at Dave & Buster’s Entertainment, Inc. (NASDAQ:PLAY), Alder Biopharmaceuticals Inc (NASDAQ:ALDR), Steelcase Inc. (NYSE:SCS), and Sabra Health Care REIT Inc (NASDAQ:SBRA). This group of stocks’ market valuations are closest to ARLP’s market valuation.

As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $221 million. That figure was $57 million in ARLP’s case. Dave & Buster’s Entertainment, Inc. (NASDAQ:PLAY) is the most popular stock in this table. On the other hand Sabra Health Care REIT Inc (NASDAQ:SBRA) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Alliance Resource Partners, L.P. (NASDAQ:ARLP) is even less popular than SBRA. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock.

Disclosure: None