Is CenturyLink, Inc. (CTL) A Good Stock To Buy?

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Seeing as CenturyLink, Inc. (NYSE:CTL) has faced a declination in interest from the aggregate hedge fund industry, logic holds that there exists a select few hedgies who sold off their entire stakes in the third quarter. It’s worth mentioning that Peter Muller’s PDT Partners sold off the biggest investment of all the hedgies followed by Insider Monkey, comprising close to $33.8 million in stock, and David Harding’s Winton Capital Management was right behind this move, as the fund dropped about $12.6 million worth of shares. These transactions are important to note, as total hedge fund interest fell by 7 funds in the third quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as CenturyLink, Inc. (NYSE:CTL) but similarly valued. We will take a look at Tyco International Ltd. (NYSE:TYC), Pearson PLC (ADR) (NYSE:PSO), Weyerhaeuser Company (NYSE:WY), and Principal Financial Group Inc (NYSE:PFG). This group of stocks’ market valuations resemble CTL’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TYC 35 1009794 -4
PSO 4 22557 -5
WY 30 1054935 1
PFG 19 164301 -2

As you can see these stocks had an average of 22 hedge funds with bullish positions and the average amount invested in these stocks was $563 million. That figure was $297 million in CTL’s case. Tyco International Ltd. (NYSE:TYC) is the most popular stock in this table, while Pearson PLC (ADR) (NYSE:PSO) is the least popular one with only 4 bullish hedge fund positions. CenturyLink, Inc. (NYSE:CTL) is not the most popular stock in this group, but hedge fund interest is still above average. Although this is a slightly positive signal, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard TYC might be a better candidate to consider a long position.

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