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Is HCC Insurance Holdings, Inc. (HCC) A Good Stock To Buy?

With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. Alyeska Investment Group, managed by Anand Parekh, assembled the biggest position in HCC Insurance Holdings, Inc. (NYSE:HCC). According to its latest 13F filing, the fund had $34.2 million invested in the company at the end of the quarter. Shane Finemore’s Manikay Partners also initiated an $31 million position during the quarter. The following funds were also among the new HCC investors: David Costen Haley’s HBK Investments, John Bader’s Halcyon Asset Management, and Matthew Tewksbury’s Stevens Capital Management.

Let’s now take a look at hedge fund activity in other stocks similar to HCC Insurance Holdings, Inc. (NYSE:HCC). We will take a look at Willis Group Holdings PLC (NYSE:WSH), News Corp (NASDAQ:NWSA), AGL Resources Inc. (NYSE:GAS), and Gildan Activewear Inc (USA) (NYSE:GIL). All of these stocks’ market caps resemble HCC’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
WSH 27 2342118 1
NWSA 35 1126782 -4
GAS 30 528324 2
GIL 19 203148 8

As you can see these stocks had an average of 28 hedge funds with bullish positions and the average amount invested in these stocks was $1.05 billion. In the case of HCC, that figure was $733 million. News Corp (NASDAQ:NWSA) is the most popular stock in this table, while Gildan Activewear Inc (USA) (NYSE:GIL) is the laggard with only 19 bullish hedge fund positions. HCC Insurance Holdings, Inc. (NYSE:HCC) 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 NWSA might be a better candidate to consider a long position.

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