Should You Avoid Skyworks Solutions Inc (SWKS)?

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Because Skyworks Solutions Inc (NASDAQ:SWKS) has faced falling interest from hedge fund managers, logic holds that there lies a certain “tier” of hedge funds who were dropping their entire stakes in the third quarter. Interestingly, John Lykouretzos’ Hoplite Capital Management dropped the biggest position of all the hedgies monitored by Insider Monkey, totaling an estimated $25.1 million in call options. These bearish behaviors are important to note, as total hedge fund interest dropped by 1 fund in the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Skyworks Solutions Inc (NASDAQ:SWKS) but similarly valued. These stocks are Vodafone Group Plc (ADR) (NASDAQ:VOD), Cabot Oil & Gas Corporation (NYSE:COG), Agnico-Eagle Mines Limited (USA) (NYSE:AEM), and Principal Financial Group Inc (NYSE:PFG). This group of stocks’ market valuations are closest to SWKS’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
VOD 18 445786 -4
COG 35 1797666 -1
AEM 25 500237 -4
PFG 15 119234 -3

As you can see these stocks had an average of 23.25 hedge funds with bullish positions and the average amount invested in these stocks was $716 million. That figure was $458 million in SWKS’s case. Cabot Oil & Gas Corporation (NYSE:COG) is the most popular stock in this table. On the other hand Principal Financial Group Inc (NYSE:PFG) is the least popular one with only 15 bullish hedge fund positions. Skyworks Solutions Inc (NASDAQ:SWKS) 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 COG might be a better candidate to consider a long position.

Disclosure: None

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