Is Allison Transmission Holdings Inc (ALSN) Going to Burn These Hedge Funds?

Since Allison Transmission Holdings Inc (NYSE:ALSN) has faced a declination in interest from hedge fund managers, it’s safe to say that there lies a certain “tier” of funds that decided to sell off their full holdings by the end of the third quarter. It’s worth mentioning that Larry Foley and Paul Farrell’s Bronson Point Partners said goodbye to the largest stake of the “upper crust” of funds followed by Insider Monkey, worth an estimated $14.7 million in stock, and Anand Parekh’s Alyeska Investment Group was right behind this move, as the fund sold off about $2.9 million worth. These transactions are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now take a look at hedge fund activity in other stocks similar to Allison Transmission Holdings Inc (NYSE:ALSN). These stocks are Embraer SA (ADR) (NYSE:ERJ), Transocean LTD (NYSE:RIG), EQT Midstream Partners LP (NYSE:EQM), and Marvell Technology Group Ltd. (NASDAQ:MRVL). This group of stocks’ market values resembles Allison Transmission Holdings Inc (NYSE:ALSN)’s market value.

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 $290 million. That figure was $1.61 billion in Allison Transmission Holdings Inc (NYSE:ALSN)’s case. Transocean LTD (NYSE:RIG) is the most popular stock in this table. On the other hand, Embraer SA (ADR) (NYSE:ERJ) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks, Allison Transmission Holdings Inc (NYSE:ALSN) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.