Should You Bet On AFLAC Incorporated (AFL)?

As aggregate interest increased, key hedge funds were leading the bulls’ herd. Citadel Investment Group, managed by Ken Griffin, created the biggest call position in AFLAC Incorporated (NYSE:AFL). The fund reportedly had $22.2 million invested in the company at the end of the quarter. D E Shaw also made a $1.9 million investment in the stock during the quarter. The other funds with new positions in the stock are Alec Litowitz and Ross Laser’s Magnetar Capital, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners, and Joe DiMenna’s ZWEIG DIMENNA PARTNERS.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as AFLAC Incorporated (NYSE:AFL) but similarly valued. These stocks are Canadian Imperial Bank of Commerce (USA) (NYSE:CM), Waste Management, Inc. (NYSE:WM), The Blackstone Group L.P. (NYSE:BX), and Activision Blizzard, Inc. (NASDAQ:ATVI). This group of stocks’ market values are closest to AFL’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CM 18 286137 4
WM 34 2122045 0
BX 32 403795 0
ATVI 64 4243407 -4

As you can see these stocks had an average of 37 hedge funds with bullish positions and the average amount invested in these stocks was $1.76 billion. That figure was just $508 million in AFL’s case. Activision Blizzard, Inc. (NASDAQ:ATVI) is the most popular stock in this table. On the other hand Canadian Imperial Bank of Commerce (USA) (NYSE:CM) is the least popular one with only 18 bullish hedge fund positions. AFLAC Incorporated (NYSE:AFL) 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 ATVI might be a better candidate to consider a long position in.

Disclosure: None