Zoe’s Kitchen Inc (ZOES): Hedge Fund Sentiment Unchanged

Page 2 of 2

Seeing as Zoe’s Kitchen Inc (NYSE:ZOES) has experienced a declination in interest from the smart money, logic holds that there lies a certain “tier” of fund managers who sold off their entire stakes by the end of the third quarter. It’s worth mentioning that Doug Gordon, Jon Hilsabeck and Don Jabro’s Shellback Capital dropped the largest investment of the “upper crust” of funds tracked by Insider Monkey, totaling about $13.9 million in stock, and Brian C. Freckmann’s Lyon Street Capital was right behind this move, as the fund cut about $1.7 million worth of shares. These transactions are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Zoe’s Kitchen Inc (NYSE:ZOES) but similarly valued. We will take a look at Cosan Limited (USA) (NYSE:CZZ), ACCO Brands Corporation (NYSE:ACCO), First Bancorp (NYSE:FBP), and Navigant Consulting, Inc. (NYSE:NCI). All of these stocks’ market caps match ZOES’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CZZ 15 67005 -2
ACCO 11 35297 -4
FBP 14 208642 -3
NCI 15 55490 3

As you can see, these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $92 million. That figure was $125 million in Zoe’s Kitchen Inc (NYSE:ZOES)’s case. Cosan Limited (USA) (NYSE:CZZ) is the most popular stock in this table. On the other hand, ACCO Brands Corporation (NYSE:ACCO) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks, Zoe’s Kitchen Inc (NYSE:ZOES) is even less popular than ACCO Brands Corporation (NYSE:ACCO). 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.

Page 2 of 2