Is Commercial Metals Company (CMC) Worthy of Your Portfolio?

We already know that not all hedge funds are bullish on the stock and some hedge funds actually sold off their positions entirely. Interestingly, Bruce Kovner’s Caxton Associates LP sold off the largest position of the 700 funds followed by Insider Monkey, valued at close to $6.9 million in stock, and Israel Englander’s Millennium Management was right behind this move, as the fund dumped about $3.4 million worth of shares.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Commercial Metals Company (NYSE:CMC) but similarly valued. These stocks are Marriott Vacations Worldwide Corp (NYSE:VAC), Simpson Manufacturing Co, Inc. (NYSE:SSD), American Assets Trust, Inc (NYSE:AAT), and Houghton Mifflin Harcourt Co (NASDAQ:HMHC). This group of stocks’ market valuations resemble CMC’s market valuation.

As you can see these stocks had an average of 11 funds with bullish positions and the average amount invested in these stocks was $259 million, compared to $146 million in CMC’s case. Houghton Mifflin Harcourt Co (NASDAQ:HMHC) is the most popular stock in this table. On the other hand American Assets Trust, Inc (NYSE:AAT) is the least popular one with only six bullish hedge fund positions. Commercial Metals Company (NYSE:CMC) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard Houghton Mifflin Harcourt Co (NASDAQ:HMHC) might be a better candidate to consider taking a long position in.

Disclosure: None