Should You Avoid Omnicom Group Inc. (OMC)?

Due to the fact that Omnicom Group Inc. (NYSE:OMC) has witnessed falling interest from hedge fund managers, it’s safe to say that there were a few hedge funds that elected to cut their full holdings by the end of the third quarter. Intriguingly, George Hall’s Clinton Group sold off the largest stake of the “upper crust” of funds monitored by Insider Monkey, worth close to $5.8 million in stock, and Jacob Gottlieb’s Visium Asset Management was right behind this move, as the fund dropped about $2.6 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 4 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Omnicom Group Inc. (NYSE:OMC) but similarly valued. These stocks are SK Telecom Co., Ltd. (ADR) (NYSE:SKM), Alliance Data Systems Corporation (NYSE:ADS), Northern Trust Corporation (NASDAQ:NTRS), and Liberty Interactive Corp (NASDAQ:QVCA). This group of stocks’ market caps resemble OMC’s market cap.

As you can see these stocks had an average of 30.75 hedge funds with bullish positions and the average amount invested in these stocks was $1267 million. That figure was $1530 million in OMC’s case. Liberty Interactive Corp (NASDAQ:QVCA) is the most popular stock in this table. On the other hand SK Telecom Co., Ltd. (ADR) (NYSE:SKM) is the least popular one with only 7 bullish hedge fund positions. Omnicom Group Inc. (NYSE:OMC) 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 QVCA might be a better candidate to consider a long position.