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Is Kraft Heinz Co (KHC) a Good Stock To Buy?

Due to the fact that Kraft Heinz Co (NASDAQ:KHC) has faced falling interest from the aggregate hedge fund industry, it’s safe to say that there exists a select few funds that elected to cut their full holdings in the third quarter. It’s worth mentioning that James Crichton’s Hitchwood Capital Management dumped the largest investment of the “upper crust” of funds followed by Insider Monkey, worth an estimated $97.3 million in stock. Clint Carlson’s fund, Carlson Capital, also dumped its stock, about $23.9 million worth. These transactions are intriguing to say the least, as total hedge fund interest dropped by 8 funds in the third quarter.

Let’s check out hedge fund activity in other stocks similar to Kraft Heinz Co (NASDAQ:KHC). We will take a look at NTT Docomo Inc (ADR) (NYSE:DCM), 3M Co (NYSE:MMM), McDonald’s Corporation (NYSE:MCD), and GlaxoSmithKline plc (ADR) (NYSE:GSK). This group of stocks’ market values resemble KHC’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DCM 6 91843 -2
MMM 40 539304 3
MCD 55 2771731 -8
GSK 33 1094325 5

As you can see these stocks had an average of 34 investors holding bullish positions and the average amount invested in these stocks was $1.12 billion. That figure was $31.24 billion in KHC’s case. McDonald’s Corporation (NYSE:MCD) is the most popular stock in this table, while NTT Docomo Inc (ADR) (NYSE:DCM) is the least popular one with only six funds long the stock. Kraft Heinz Co (NASDAQ:KHC) 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 McDonald’s Corporation (NYSE:MCD) might be a better candidate to consider a long position.

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