Is Waddell & Reed Financial, Inc. (WDR) A Good Stock To Buy?

As one would reasonably expect, key hedge funds have jumped into Waddell & Reed Financial, Inc. (NYSE:WDR) headfirst. Dreman Value Management, managed by David Dreman, initiated the largest position in Waddell & Reed Financial, Inc. (NYSE:WDR). Dreman Value Management had $5.2 million invested in the company at the end of the quarter. Millennium Management Subsidiary’s Blue Arrow Capital Management also initiated a $1.7 million position during the quarter. The other funds with new positions in the stock are Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital, Ray Dalio’s Bridgewater Associates, and Matthew Tewksbury’s Stevens Capital Management.

Let’s check out hedge fund activity in other stocks similar to Waddell & Reed Financial, Inc. (NYSE:WDR). These stocks are SunPower Corporation (NASDAQ:SPWR), John Wiley & Sons Inc (NYSE:JW), Columbia Property Trust Inc (NYSE:CXP), and Targa Resources Corp (NYSE:TRGP). This group of stocks’ market caps matches Waddell & Reed Financial, Inc. (NYSE:WDR)’s market cap.

As you can see, these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $180 million. That figure was $173 million in Waddell & Reed Financial, Inc. (NYSE:WDR)’s case. Targa Resources Corp (NYSE:TRGP) is the most popular stock in this table. On the other hand, Columbia Property Trust Inc (NYSE:CXP) is the least popular one with only 9 bullish hedge fund positions. Waddell & Reed Financial, Inc. (NYSE:WDR) 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, Targa Resources Corp (NYSE:TRGP) might be a better candidate to consider a long position.