We view hedge fund activity in the stock as unfavorable, but in this case there was only a single hedge fund selling its entire position: Springbok Capital. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this instance because none of the 700+ hedge funds tracked by Insider Monkey identified VNCE as a viable investment and initiated a position in the stock.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Vince Holding Corp (NYSE:VNCE) but similarly valued. We will take a look at CNinsure Inc. (ADR) (NASDAQ:CISG), TravelCenters of America LLC (NYSEAMEX:TA), Phoenix New Media Ltd ADR (NYSE:FENG), and Golden Entertainment Inc (NASDAQ:GDEN). All of these stocks’ market caps match VNCE’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CISG | 7 | 5699 | -1 |
| TA | 14 | 28866 | -1 |
| FENG | 10 | 25476 | 2 |
| GDEN | 10 | 30225 | 3 |
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 $23 million. That figure was $32 million in VNCE’s case. TravelCenters of America LLC (NYSEAMEX:TA) is the most popular stock in this table. On the other hand CNinsure Inc. (ADR) (NASDAQ:CISG) is the least popular one with only 7 bullish hedge fund positions. Vince Holding Corp (NYSE:VNCE) 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 TA might be a better candidate to consider taking a long position in.
Disclosure: None
