Nippon Telegraph & Telephone Corp (ADR) (NTT): Are Hedge Funds Right About This Stock?

Because Nippon Telegraph & Telephone Corp (ADR) (NYSE:NTT) has witnessed a decline in interest from the entirety of the hedge funds we track, it’s safe to say that there lies a certain “tier” of hedgies who were dropping their positions entirely last quarter. It’s worth mentioning that Ernest Chow and Jonathan Howe’s Sensato Capital Management cut the biggest position of all the investors watched by Insider Monkey, valued at about $5.1 million in stock. David E. Shaw’s fund, D E Shaw, also sold off its stock, about $2.4 million worth of NTT shares.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Nippon Telegraph & Telephone Corp (ADR) (NYSE:NTT) but similarly valued. These stocks are BHP Billiton Limited (ADR) (NYSE:BHP), Royal Bank of Canada (USA) (NYSE:RY), Allergan, Inc. (NYSE:AGN), and Bristol Myers Squibb Co. (NYSE:BMY). This group of stocks’ market caps are similar to NTT’s market cap.

As you can see these stocks had an average of 52 hedge funds with bullish positions and the average amount invested in these stocks was $3.39 billion. That figure was $183 million in NTT’s case. Allergan, Inc. (NYSE:AGN) is the most popular stock in this table. On the other hand Royal Bank of Canada (USA) (NYSE:RY) is the least popular one with only 17 bullish hedge fund positions. Compared to these stocks Nippon Telegraph & Telephone Corp (ADR) (NYSE:NTT) is even less popular than RY. 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. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

Disclosure: None