Why Intuit Inc. (INTU)’s Stock Is Down on Wednesday?

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Judging by the fact that Intuit Inc. (NASDAQ:INTU) has witnessed bearish sentiment from the entirety of the hedge funds we track, we can see that there is a sect of funds who sold off their positions entirely by the end of the first quarter. At the top of the heap, David E. Shaw’s D E Shaw cut the largest investment of the “upper crust” of funds watched by Insider Monkey, valued at an estimated $35.7 million in stock, and Robert Pitts’s Steadfast Capital Management was right behind this move, as the fund dumped about $29.2 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest fell by 4 funds by the end of the first quarter.

Let’s now take a look at hedge fund activity in other stocks similar to Intuit Inc. (NASDAQ:INTU). We will take a look at O’Reilly Automotive Inc (NASDAQ:ORLY), AFLAC Incorporated (NYSE:AFL), SYSCO Corporation (NYSE:SYY), and Waste Management, Inc. (NYSE:WM). This group of stocks’ market values match INTU’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ORLY 42 923759 0
AFL 28 515799 4
SYY 26 3696340 4
WM 28 1569501 -1

As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $1676 million. That figure was $719 million in INTU’s case. O’Reilly Automotive Inc (NASDAQ:ORLY) is the most popular stock in this table. On the other hand SYSCO Corporation (NYSE:SYY) is the least popular one with only 26 bullish hedge fund positions. Compared to these stocks Intuit Inc. (NASDAQ:INTU) is even less popular than SYY. 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.

Disclosure: None

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