Should You Avoid W.P. Carey Inc. REIT (WPC)?

Judging by the fact that W.P. Carey Inc. REIT (NYSE:WPC) has experienced a declining sentiment from the entirety of the hedge funds we track, it’s easy to see that there was a specific group of hedgies that elected to cut their full holdings in the third quarter. At the top of the heap, John Overdeck and David Siegel’s Two Sigma Advisors cut the biggest investment of the 700 funds followed by Insider Monkey, comprising close to $6.9 million in stock, and Jim Simons’ Renaissance Technologies was right behind this move, as the fund cut about $5 million worth of shares.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as W.P. Carey Inc. REIT (NYSE:WPC) but similarly valued. We will take a look at Toll Brothers Inc (NYSE:TOL), Cadence Design Systems Inc (NASDAQ:CDNS), The Middleby Corporation (NASDAQ:MIDD), and UGI Corp (NYSE:UGI). This group of stocks’ market caps are similar to WPC’s market cap.

As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $761 million, higher than the $109 million in WPC’s case. Toll Brothers Inc (NYSE:TOL) is the most popular stock in this table. On the other hand UGI Corp (NYSE:UGI) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks W.P. Carey Inc. REIT (NYSE:WPC) is even less popular than UGI. 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.