Is USA Truck, Inc. (USAK) A Good Stock To Buy?

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Because USA Truck, Inc. (NASDAQ:USAK) has faced declining sentiment from the entirety of the hedge funds we track, we can see that there was a specific group of hedgies that decided to sell off their full holdings last quarter. Interestingly, Peter S. Park’s Park West Asset Management sold off the biggest investment of the “upper crust” of funds tracked by Insider Monkey, worth close to $3.4 million in stock, and Julian Robertson’s Tiger Management was right behind this move, as the fund cut about $2.2 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 2 funds last quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as USA Truck, Inc. (NASDAQ:USAK) but similarly valued. These stocks are Guidance Software, Inc. (NASDAQ:GUID), Quantum Corp (NYSE:QTM), Ultra Clean Holdings Inc (NASDAQ:UCTT), and Sears Hometown and Outlet Stores Inc (NASDAQ:SHOS). This group of stocks’ market caps match USAK’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
GUID 11 30058 -1
QTM 17 51027 -7
UCTT 18 26615 8
SHOS 16 78110 0

As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $46 million, compared to $18 million in USAK’s case. Ultra Clean Holdings Inc (NASDAQ:UCTT) is the most popular stock in this table, while Guidance Software, Inc. (NASDAQ:GUID) is the least popular one with only 11 bullish hedge fund positions. USA Truck, Inc. (NASDAQ:USAK) 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 UCTT might be a better candidate to consider a long position.

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