Is Virtusa Corporation (VRTU) A Good Stock To Buy?

Because Virtusa Corporation (NASDAQ:VRTU) has experienced bearish sentiment from the smart money, we can see that there were a few funds who sold off their positions entirely last quarter. It’s worth mentioning that Joel Greenblatt’s Gotham Asset Management dumped the largest stake of all the hedgies monitored by Insider Monkey, totaling about $2.2 million in stock, and Israel Englander’s Millennium Management was right behind this move, as the fund cut about $1.2 million worth of VRTU stock. These bearish behaviors are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Virtusa Corporation (NASDAQ:VRTU) but similarly valued. We will take a look at LTC Properties Inc (NYSE:LTC), Seaspan Corporation (NYSE:SSW), FBL Financial Group (NYSE:FFG), and Community Bank System, Inc. (NYSE:CBU). All of these stocks’ market caps match VRTU’s market cap.

As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $14 million. That figure was $25 million in VRTU’s case. LTC Properties Inc (NYSE:LTC) is the most popular stock in this table, while Community Bank System, Inc. (NYSE:CBU) is the laggard with only 6 bullish hedge fund positions. Compared to these stocks Virtusa Corporation (NASDAQ:VRTU) is clearly more popular, with 9 long hedge fund positions. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.