Is Continental Resources, Inc. (CLR) a Good Stock To Buy?

Because Continental Resources, Inc. (NYSE:CLR) has experienced falling interest from hedge fund managers, it’s safe to say that there is a sect of hedge funds that slashed their entire stakes in the third quarter. Interestingly, Marc Lisker, Glenn Fuhrman and John Phelan’s MSDC Management sold off the biggest investment of the “upper crust” of funds followed by Insider Monkey, totaling about $19.7 million in stock. Kenneth Tropin’s fund, Graham Capital Management, also dumped its stock, about $17.9 million worth. These transactions are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s also examine hedge fund activity in other stocks similar to Continental Resources, Inc. (NYSE:CLR). We will take a look at Mead Johnson Nutrition CO (NYSE:MJN), Marriott International Inc (NYSE:MAR), ORIX Corporation (ADR) (NYSE:IX), and Stanley Black & Decker, Inc. (NYSE:SWK). This group of stocks’ market caps are similar to CLR’s market cap.

As you can see these stocks had an average of 29 funds with bullish positions and the average amount invested in these stocks was $986 million. That figure was $712 million in CLR’s case. Marriott International Inc (NYSE:MAR) is the most popular stock in this table with 48 investors holding shares. On the other hand, ORIX Corporation (ADR) (NYSE:IX) is the least popular one with only six bullish hedge fund positions. Continental Resources, Inc. (NYSE:CLR) is not the most popular stock in this group, but the 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 MAR might be a better candidate to consider a long position.