Is Freshpet Inc (FRPT) A Good Stock To Buy?

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Freshpet Inc (NASDAQ:FRPT) but similarly valued. These stocks are ChemoCentryx Inc (NASDAQ:CCXI), Nutraceutical Int’l Corp. (NASDAQ:NUTR), Control4 Corp (NASDAQ:CTRL), and ASA Gold and Precious Metals Ltd (NYSE:ASA). This group of stocks’ market values resemble FRPT’s market value.

As you can see these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $36 million. That figure was $14 million in FRPT’s case. Control4 Corp (NASDAQ:CTRL) is the most popular stock in this table. On the other hand Nutraceutical Int’l Corp. (NASDAQ:NUTR) is the least popular one with only 4 bullish hedge fund positions. Freshpet Inc (NASDAQ:FRPT) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard CTRL might be a better candidate to consider taking a long position in.

Disclosure: None