Is Triangle Capital Corporation (TCAP) A Good Stock To Buy?

As one would reasonably expect, key hedge funds have jumped into Triangle Capital Corporation (NYSE:TCAP) headfirst. PDT Partners established the most valuable position in Triangle Capital Corporation (NYSE:TCAP). Citadel Investment Group also made a $0.4 million investment in the stock during the quarter. The other funds with new positions in the stock are Millennium Management, D E Shaw, and John Overdeck and David Siegel’s Two Sigma Advisors.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Triangle Capital Corporation (NYSE:TCAP) but similarly valued. These stocks are Mercury Systems Inc (NASDAQ:MRCY), PC Connection, Inc. (NASDAQ:PCCC), Fly Leasing Ltd(ADR) (NYSE:FLY), and Piper Jaffray Companies (NYSE:PJC). This group of stocks’ market valuations are closest to TCAP’s market valuation.

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $71 million, higher than the $7 million in TCAP’s case. Mercury Systems Inc (NASDAQ:MRCY) is the most popular stock in this table, while PC Connection, Inc. (NASDAQ:PCCC) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Triangle Capital Corporation (NYSE:TCAP) is even less popular than PCCC. Considering that hedge funds aren’t fond of this stock in relation to other companies covered 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.