Should You Avoid Magellan Health Inc (MGLN)?

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Because Magellan Health Inc (NASDAQ:MGLN) has faced a decline in interest from hedge fund managers, logic holds that there is a sect of money managers who sold off their full holdings heading into Q4. Intriguingly, Peter Algert and Kevin Coldiron’s Algert Coldiron Investors said goodbye to the biggest stake of the 700 funds followed by Insider Monkey, totaling close to $2 million in stock, and George Hall’s Clinton Group was right behind this move, as the fund dropped about $0.3 million worth of MGLN shares. These moves are intriguing to say the least, as total hedge fund interest dropped by 2 funds heading into Q4.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Magellan Health Inc (NASDAQ:MGLN) but similarly valued. We will take a look at Columbia Banking System Inc (NASDAQ:COLB), Kaiser Aluminum Corp. (NASDAQ:KALU), Stag Industrial Inc (NYSE:STAG), and West Corp (NASDAQ:WSTC). This group of stocks’ market valuations are similar to MGLN’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
COLB 6 83231 -4
KALU 15 167607 2
STAG 6 60320 0
WSTC 15 42460 2

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $88 million. That figure was $199 million in MGLN’s case. Kaiser Aluminum Corp. (NASDAQ:KALU) is the most popular stock in this table. On the other hand Columbia Banking System Inc (NASDAQ:COLB) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks Magellan Health Inc (NASDAQ:MGLN) is more popular among hedge funds. 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.

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Disclosure: None




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