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New Relic Inc (NEWR): Are Hedge Funds Right About This Stock?

Consequently, some big names have been driving this bullishness. Cupps Capital Management, managed by Drew Cupps, created the biggest position in New Relic Inc (NYSE:NEWR), worth an estimated $13.7 million at the end of the quarter. Clifford Fox’s Columbus Circle Investors also initiated a $12 million position during the quarter. The other funds with new positions in the stock are Leon Shaulov’s Maplelane Capital, D. E. Shaw’s D E Shaw, and Steve Cohen’s Point72 Asset Management.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as New Relic Inc (NYSE:NEWR) but similarly valued. We will take a look at Dorman Products Inc. (NASDAQ:DORM), American Equity Investment Life Holding (NYSE:AEL), GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH), and Columbia Banking System Inc (NASDAQ:COLB). This group of stocks’ market values resemble NEWR’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DORM 9 129717 -5
AEL 24 242872 12
GWPH 19 193759 4
COLB 14 131452 3

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 $174 million. That figure was $239 million in NEWR’s case, a good sign. American Equity Investment Life Holding (NYSE:AEL) is the most popular stock in this table, whereas Dorman Products Inc. (NASDAQ:DORM) is the least popular one with only 9 bullish hedge fund positions. New Relic Inc (NYSE:NEWR) is not the most popular stock in this group, but hedge fund interest is still above average. Although this is a slightly positive signal, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard AEL might be a better candidate to consider a long position.

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