Is National Retail Properties, Inc. (NNN) A Good Stock To Buy?

Due to the fact that National Retail Properties, Inc. (NYSE:NNN) has witnessed declining sentiment from hedge fund managers, it’s safe to say that there exists a select few hedge funds that slashed their full holdings last quarter. Interestingly, Peter Muller’s PDT Partners cut the biggest position of the “upper crust” of funds monitored by Insider Monkey, valued at about $1.3 million in stock. Peter Rathjens, Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also dumped its holding, about $1.2 million worth of shares. These moves are interesting, as aggregate hedge fund interest was cut by 1 fund last quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as National Retail Properties, Inc. (NYSE:NNN) but similarly valued. These stocks are People’s United Financial, Inc. (NASDAQ:PBCT), Live Nation Entertainment, Inc. (NYSE:LYV), Silver Wheaton Corp. (USA) (NYSE:SLW), and ISIS Pharmaceuticals, Inc. (NASDAQ:ISIS). This group of stocks’ market valuations match NNN’s market valuation.

As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $233 million. That figure was $197 million in NNN’s case. Live Nation Entertainment, Inc. (NYSE:LYV) is the most popular stock in this table. On the other hand People’s United Financial, Inc. (NASDAQ:PBCT) is the least popular one with only 10 bullish hedge fund positions. National Retail Properties, Inc. (NYSE:NNN) 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 LYV might be a better candidate to consider a long position.