Should You Avoid G-III Apparel Group, Ltd. (GIII)?

Due to the fact that G-III Apparel Group, Ltd. (NASDAQ:GIII) has experienced bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of hedge funds that decided to sell off their positions entirely by the end of the third quarter. It’s worth mentioning that Chuck Royce’s Royce & Associates dropped the biggest position of the 700 funds tracked by Insider Monkey, comprising an estimated $19.5 million in stock, and Ken Heebner’s Capital Growth Management was right behind this move, as the fund dumped about $12 million worth of GIII shares. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 1 fund by the end of the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as G-III Apparel Group, Ltd. (NASDAQ:GIII) but similarly valued. We will take a look at Mercury General Corporation (NYSE:MCY), Deluxe Corporation (NYSE:DLX), Emcor Group Inc (NYSE:EME), and Rayonier Inc. (NYSE:RYN). This group of stocks’ market caps match GIII’s market cap.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $201 million. That figure was $178 million in GIII’s case. Deluxe Corporation (NYSE:DLX) is the most popular stock in this table. On the other hand Mercury General Corporation (NYSE:MCY) is the least popular one with only 8 bullish hedge fund positions. G-III Apparel Group, Ltd. (NASDAQ:GIII) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard DLX might be a better candidate to consider a long position.