There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Carl Icahn and George Soros think. Those hedge fund operators make billions of dollars each year by hiring the best and the brightest to do research on stocks, including small cap stocks that big brokerage houses simply don’t cover. Because of Carl Icahn and other successful funds’ exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze Camden National Corporation (NASDAQ:CAC) .
Hedge fund interest in Camden National Corporation (NASDAQ:CAC) shares was flat at the end of last quarter. This is usually a negative indicator. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as ArcBest Corp (NASDAQ:ARCB), PJT Partners Inc (NYSE:PJT), and Bazaarvoice Inc (NASDAQ:BV) to gather more data points.
Follow Camden National Corp (INDEXEURO:CAC)
Follow Camden National Corp (INDEXEURO:CAC)
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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Now, let’s take a look at the new action regarding Camden National Corporation (NASDAQ:CAC).
What have hedge funds been doing with Camden National Corporation (NASDAQ:CAC)?
At the end of the third quarter, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from the second quarter of 2016. By comparison, 7 hedge funds held shares or bullish call options in CAC heading into this year. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Chuck Royce’s Royce & Associates has the number one position in Camden National Corporation (NASDAQ:CAC), worth close to $43.8 million. The second most bullish fund manager is Renaissance Technologies, one of the largest hedge funds in the world, which holds a $11.4 million position. Other hedge funds and institutional investors that are bullish encompass Matthew Lindenbaum’s Basswood Capital, D. E. Shaw’s D E Shaw and Cliff Asness’ AQR Capital Management. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Mendon Capital Advisors. 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 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was AQR Capital Management).
Let’s go over hedge fund activity in other stocks similar to Camden National Corporation (NASDAQ:CAC). We will take a look at ArcBest Corp (NASDAQ:ARCB), PJT Partners Inc (NYSE:PJT), Bazaarvoice Inc (NASDAQ:BV), and Unisys Corporation (NYSE:UIS). This group of stocks’ market caps match CAC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ARCB | 13 | 26835 | 2 |
| PJT | 10 | 141761 | -4 |
| BV | 24 | 145630 | 7 |
| UIS | 20 | 71205 | 2 |
As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $96 million. That figure was $67 million in CAC’s case. Bazaarvoice Inc (NASDAQ:BV) is the most popular stock in this table. On the other hand PJT Partners Inc (NYSE:PJT) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Camden National Corporation (NASDAQ:CAC) is even less popular than PJT. 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.
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