Is OHA Investment Corp (OHAI) A Good Stock To Buy?

We view hedge fund selling in the stock unfavorable, but in this case, there was only a single hedge fund selling its entire position: Millennium Management. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in here because only one of the 700+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Coe Capital Management).

Let’s go over hedge fund activity in other stocks similar to OHA Investment Corp (NASDAQ:OHAI). These stocks are Pixelworks, Inc. (NASDAQ:PXLW), Dover Motorsports, Inc. (NYSE:DVD), Universal Technical Institute, Inc. (NYSE:UTI), and L.S. Starrett Company (NYSE:SCX). This group of stocks’ market valuations matches OHA Investment Corp (NASDAQ:OHAI)’s market valuation.

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 $14 million. That figure was $4 million in OHA Investment Corp (NASDAQ:OHAI)’s case. Universal Technical Institute, Inc. (NYSE:UTI) is the most popular stock in this table. On the other hand, L.S. Starrett Company (NYSE:SCX) is the least popular one, with only 4 bullish hedge fund positions. Compared to these stocks, OHA Investment Corp (NASDAQ:OHAI) is even less popular than L.S. Starrett Company (NYSE:SCX). Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case, more research is warranted.