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Is Petmed Express Inc (PETS) Going to Burn Investors?

Since Petmed Express Inc (NASDAQ:PETS) has witnessed a decline in interest from the aggregate hedge fund industry, logic holds that there exists a select few hedge funds that elected to cut their entire stakes in the third quarter. Interestingly, Israel Englander’s Millennium Management cut the biggest stake of all the investors monitored by Insider Monkey, valued at an estimated $0.6 million in stock. Paul Tudor Jones’ fund, Tudor Investment Corp, also said goodbye to its stock, about $0.3 million worth.

Let’s now review hedge fund activity in other stocks similar to Petmed Express Inc (NASDAQ:PETS). These stocks are Kratos Defense & Security Solutions, Inc (NASDAQ:KTOS), Carbonite Inc (NASDAQ:CARB), QCR Holdings, Inc. (NASDAQ:QCRH), and Federal Agricultural Mortgage Corp. (NYSE:AGM). This group of stocks’ market valuations are similar to PETS’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
KTOS 10 41655 1
CARB 22 144009 -1
QCRH 6 47154 -1
AGM 8 17262 2

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $63 million. That figure was $51 million in PETS’s case. Carbonite Inc (NASDAQ:CARB) is the most popular stock in this table. On the other hand QCR Holdings, Inc. (NASDAQ:QCRH) is the least popular one with only 6 bullish hedge fund positions. Petmed Express Inc (NASDAQ:PETS) 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 CARB might be a better candidate to consider taking a long position in.

Disclosure: None

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