Is Shell Midstream Partners LP (SHLX) a Good Stock to Buy?

As one would reasonably expect, key money managers were breaking ground themselves. Driehaus Capital, created the largest position in Shell Midstream Partners LP (NYSE:SHLX). Driehaus Capital had $3.2 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $0.7 million position during the quarter. The following funds were also among the new SHLX investors: Israel Englander’s Millennium Management and Matthew Hulsizer’s PEAK6 Capital Management.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Shell Midstream Partners LP (NYSE:SHLX) but similarly valued. We will take a look at Old Dominion Freight Line (NASDAQ:ODFL), CF Industries Holdings, Inc. (NYSE:CF), Vail Resorts, Inc. (NYSE:MTN), and VCA Antech Inc (NASDAQ:WOOF). This group of stocks’ market values are closest to SHLX’s market value.

As you can see these stocks had an average of 30 hedge funds with bullish positions and the average amount invested in these stocks was $516 million. That figure was $47 million in SHLX’s case. CF Industries Holdings, Inc. (NYSE:CF) is the most popular stock in this table. On the other hand Old Dominion Freight Line (NASDAQ:ODFL) is the least popular one with only 14 bullish hedge fund positions. Compared to these stocks Shell Midstream Partners LP (NYSE:SHLX) is even less popular than ODFL. 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. This isn’t necessarily bad news. 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.

Disclosure: None