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Is Lloyds Banking Group PLC (ADR) (LYG) A Good Stock To Buy?

As aggregate interest increased, key money managers were leading the bulls’ herd. Two Sigma Advisors, led by John Overdeck and David Siegel, assembled the largest position in Lloyds Banking Group PLC (ADR) (NYSE:LYG). Two Sigma Advisors had $0.4 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $0.1 million position during the quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Lloyds Banking Group PLC (ADR) (NYSE:LYG) but similarly valued. We will take a look at BT Group plc (ADR) (NYSE:BT), UBS AG (USA) (NYSE:UBS), Canadian National Railway (USA) (NYSE:CNI), and Banco Bradesco SA (ADR) (NYSE:BBD). This group of stocks’ market values match LYG’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
BT 7 114672 -4
UBS 8 659901 -2
CNI 17 1447565 -4
BBD 13 323892 3

As you can see these stocks had an average of 11.25 hedge funds with bullish positions and the average amount invested in these stocks was $637 million. That figure was $335 million in LYG’s case. Canadian National Railway (USA) (NYSE:CNI) is the most popular stock in this table. On the other hand BT Group plc (ADR) (NYSE:BT) is the least popular one with only 7 bullish hedge fund positions. Lloyds Banking Group PLC (ADR) (NYSE:LYG) 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 CNI might be a better candidate to consider taking a long position in.