Is Imation Corp. (IMN) Going to Burn These Hedge Funds?

Since Imation Corp. (NYSE:IMN) has faced bearish sentiment from the smart money, we can see that there were a few hedgies that decided to sell off their positions entirely by the end of the third quarter. It’s worth mentioning that Israel Englander’s Millennium Management said goodbye to the largest position of the “upper crust” of funds followed by Insider Monkey, valued at an estimated $0.2 million in stock. Chao Ku’s fund, Nine Chapters Capital Management, also dropped its stock, about $0.1 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 1 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Imation Corp. (NYSE:IMN) but similarly valued. These stocks are Eastern Virginia Bankshares, Inc. (NASDAQ:EVBS), Conatus Pharmaceuticals Inc (NASDAQ:CNAT), Alliqua Biomedical Inc (NASDAQ:ALQA), and YuMe Inc (NYSE:YUME). All of these stocks’ market caps are closest to IMN’s market cap.

As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $28 million in IMN’s case. Conatus Pharmaceuticals Inc (NASDAQ:CNAT) is the most popular stock in this table. On the other hand Eastern Virginia Bankshares, Inc. (NASDAQ:EVBS) is the least popular one with only 5 bullish hedge fund positions. Imation Corp. (NYSE:IMN) 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 CNAT might be a better candidate to consider a long position.