Insider Monkey finished processing more than 700 13F filings made by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30. What do these smart investors think about Connecticut Water Service, Inc. (NASDAQ:CTWS)?
Hedge fund interest in Connecticut Water Service, Inc. (NASDAQ:CTWS) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare CTWS to other stocks, including First Business Financial Services Inc (NASDAQ:FBIZ), Clean Energy Fuels Corp (NASDAQ:CLNE), and Corcept Therapeutics Incorporated (NASDAQ:CORT) to get a better sense of its popularity.
Follow Connecticut Water Service Inc / Ct (NASDAQ:CTWS)
Follow Connecticut Water Service Inc / Ct (NASDAQ:CTWS)
If you’d ask most market participants, hedge funds are seen as worthless, old investment tools of the past. While there are greater than 8000 funds with their doors open at present, Our experts look at the leaders of this group, about 700 funds. These investment experts handle the lion’s share of all hedge funds’ total capital, and by paying attention to their best equity investments, Insider Monkey has unearthed many investment strategies that have historically beaten the market. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, let’s go over the fresh action regarding Connecticut Water Service, Inc. (NASDAQ:CTWS).
What does the smart money think about Connecticut Water Service, Inc. (NASDAQ:CTWS)?
At Q3’s end, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, unchanged from the second quarter. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Renaissance Technologies, managed by Jim Simons, holds the number one position in Connecticut Water Service, Inc. (NASDAQ:CTWS). The fund has a $6.5 million position in the stock, comprising less than 0.1% of its 13F portfolio. On Renaissance Technologies’s heels is Israel Englander of Millennium Management, with a $0.7 million position; less than 0.1% of its 13F portfolio is allocated to the stock. Other members of the smart money that are bullish consist of John Overdeck and David Siegel’s Two Sigma Advisors, Mario Gabelli’s GAMCO Investors and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: PDT Partners. 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 case, because only one of the 700+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Springbok Capital).
Let’s check out hedge fund activity in other stocks similar to Connecticut Water Service, Inc. (NASDAQ:CTWS). These stocks are First Business Financial Services Inc (NASDAQ:FBIZ), Clean Energy Fuels Corp (NASDAQ:CLNE), Corcept Therapeutics Incorporated (NASDAQ:CORT), and Multi-Fineline Electronix, Inc. (NASDAQ:MFLX). This group of stocks’ market valuations are closest to CTWS’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| FBIZ | 4 | 12689 | -1 |
| CLNE | 6 | 5048 | -6 |
| CORT | 14 | 7214 | 5 |
| MFLX | 17 | 23126 | 4 |
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 $12 million. In the case of CTWS, the amount committed by hedge funds is just $8 million. Multi-Fineline Electronix, Inc. (NASDAQ:MFLX) is the most popular stock in this table. On the other hand First Business Financial Services Inc (NASDAQ:FBIZ) is the least popular one with only 4 bullish hedge fund positions. Connecticut Water Service, Inc. (NASDAQ:CTWS) 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 MFLX might be a better candidate to consider a long position.
