Since Wells Fargo & Co (NYSE:WFC) has experienced a declining sentiment from the smart money, it’s safe to say that there is a sect of money managers that decided to sell off their entire stakes last quarter. At the top of the heap, John Armitage’s Egerton Capital Limited said goodbye to the largest stake of all the hedgies monitored by Insider Monkey, valued at close to $157.7 million in CALL options, and Anand Parekh’s Alyeska Investment Group was right behind this move, as the fund dumped about $109.7 million worth of CALL options. These moves are important to note, as total hedge fund interest was cut by 6 funds last quarter.
Let’s also examine hedge fund activity in other stocks similar to Wells Fargo & Co (NYSE:WFC). These stocks are Johnson & Johnson (NYSE:JNJ), General Electric Company (NYSE:GE), Facebook Inc (NASDAQ:FB), and China Mobile Ltd. (ADR) (NYSE:CHL). This group of stocks’ market valuations is closest to Wells Fargo & Co (NYSE:WFC)’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| JNJ | 74 | 3938813 | -4 |
| GE | 74 | 5951572 | 4 |
| FB | 128 | 8955439 | -5 |
| CHL | 20 | 213813 | -7 |
As you can see, these stocks had an average of 74 hedge funds with bullish positions and the average amount invested in these stocks was $4.77 billion. That figure was $30.86 billion in Wells Fargo & Co (NYSE:WFC)’s case. Facebook Inc (NASDAQ:FB) is the most popular stock in this table. On the other hand, China Mobile Ltd. (ADR) (NYSE:CHL) is the least popular one with only 20 bullish hedge fund positions. Wells Fargo & Co (NYSE:WFC) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, Facebook Inc (NASDAQ:FB) might be a better candidate to consider a long position.
