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Should You Buy Stonegate Bank (SGBK)?

Moreover, Nine Chapters Capital Management, managed by Chao Ku, was the only fund that initiated a stake in Stonegate Bank (NASDAQ:SGBK), which was worth $0.4 million at the end of the third quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Stonegate Bank (NASDAQ:SGBK) but similarly valued. These stocks are Noodles & Co (NASDAQ:NDLS), Century Aluminum Co (NASDAQ:CENX), Ashford Hospitality Prime Inc (NYSE:AHP), and Memorial Production Partners LP (NASDAQ:MEMP). All of these stocks’ market caps match SGBK’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NDLS 7 14840 -2
CENX 14 25847 -10
AHP 14 72741 1
MEMP 4 9732 -2

As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $31 million, which is higher than in SGBK’s case. Century Aluminum Co (NASDAQ:CENX) is the most popular stock in this table with a total of 14 funds reporting long positions. On the other hand Memorial Production Partners LP (NASDAQ:MEMP) is the least popular one with only 4 bullish hedge fund positions. Stonegate Bank (NASDAQ:SGBK) 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 CENX might be a better candidate to consider a long position.

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