Is Spectra Energy Corp. (SE) A Good Stock To Buy?

With general bullishness amongst the heavyweights, key hedge funds were breaking ground themselves. Alpine Associates established the most valuable position in Spectra Energy Corp. (NYSE:SE), followed by Magnetar Capital. The other funds with new positions in the stock are TIG Advisors, John Overdeck and David Siegel’s Two Sigma Advisors, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.

Let’s now take a look at hedge fund activity in other stocks similar to Spectra Energy Corp. (NYSE:SE). These stocks are Southwest Airlines Co. (NYSE:LUV), Baxter International Inc. (NYSE:BAX), China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU), and CSX Corporation (NYSE:CSX). This group of stocks’ market valuations are closest to SE’s market valuation.

As you can see these stocks had an average of 40 hedge funds with bullish positions and the average amount invested in these stocks was $1.85 billion. That figure was just $446 million in SE’s case. Southwest Airlines Co. (NYSE:LUV) is the most popular stock in this table. On the other hand China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) is the least popular one with only 12 bullish hedge fund positions. Spectra Energy Corp. (NYSE:SE) 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 LUV might be a better candidate to consider a long position in.

Disclosure: None