We view hedge fund activity in the stock as unfavorable, but in this case there was only a single hedge fund selling its entire position: Citadel Investment Group. 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 this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Arrowstreet Capital).
Let’s now review hedge fund activity in other stocks similar to United Community Financial Corp (NASDAQ:UCFC). We will take a look at Kadmon Holdings Inc (NYSE:KDMN), Spartan Motors Inc (NASDAQ:SPAR), Jive Software Inc (NASDAQ:JIVE), and Dorian LPG Ltd (NYSE:LPG). This group of stocks’ market caps are similar to UCFC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| KDMN | 11 | 96607 | 11 |
| SPAR | 14 | 49536 | 1 |
| JIVE | 13 | 48850 | -2 |
| LPG | 8 | 56727 | -2 |
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $63 million. That figure was $34 million in UCFC’s case. Spartan Motors Inc (NASDAQ:SPAR) is the most popular stock in this table. On the other hand Dorian LPG Ltd (NYSE:LPG) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks United Community Financial Corp (NASDAQ:UCFC) is only as popular as LPG. 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.
Disclosure: None
