Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Micron and Anadarko Petroleum, have not done well during the last 12 months ending in October due to various reasons. Nevertheless, the data show elite investors’ consensus picks have done well on average. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last four quarters ending in October and sixty three percent of these 30 stocks outperformed the market. S&P 500 Index returned only 5.2% during the same period and less than 49% of its constituents managed to beat this return. Because their consensus picks have done well, we pay attention to what elite funds think before doing extensive research on a stock. In this article, we take a closer look at Unisys Corporation (NYSE:UIS) from the perspective of those elite funds.
Is Unisys Corporation (NYSE:UIS) a bargain? The best stock pickers are becoming less confident. The number of long hedge fund bets went down by 3 lately. At the end of this article we will also compare UIS to other stocks, including Monmouth R.E. Inv. Corp. (NYSE:MNR), Matrix Service Co (NASDAQ:MTRX), and Heritage Insurance Holdings Inc (NYSE:HRTG) to get a better sense of its popularity.
Follow Unisys Corp (NYSE:UIS)
Follow Unisys Corp (NYSE:UIS)
In the eyes of most investors, hedge funds are viewed as slow, old investment tools of yesteryear. While there are over an 8000 funds in operation today, Our researchers look at the top tier of this group, about 700 funds. These investment experts preside over the lion’s share of the smart money’s total capital, and by following their finest equity investments, Insider Monkey has unearthed various investment strategies that have historically surpassed Mr. Market. Insider Monkey’s small-cap hedge fund strategy outpaced the S&P 500 index by 12 percentage points annually for a decade in their back tests.
With all of this in mind, we’re going to check out the latest action surrounding Unisys Corporation (NYSE:UIS).
What does the smart money think about Unisys Corporation (NYSE:UIS)?
Heading into Q4, a total of 13 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -19% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, James H. Litinsky’s JHL Capital Group has the number one position in Unisys Corporation (NYSE:UIS), worth close to $41.7 million, comprising 4.6% of its total 13F portfolio. Sitting at the No. 2 spot is Chuck Royce’s Royce & Associates, with a $17.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining professional money managers that are bullish consist of Matthew Knauer and Mina Faltas’ Nokota Management, John Thiessen’s Vertex One Asset Management, and Paul Solit’s Potomac Capital Management.
Seeing as Unisys Corporation (NYSE:UIS) has witnessed a declination in interest from the entirety of the hedge funds we track, we can see that there were a few hedgies that decided to sell off their entire stakes last quarter. It’s worth mentioning that Anand Parekh’s Alyeska Investment Group said goodbye to the biggest position of the 700 funds watched by Insider Monkey, comprising an estimated $3.8 million in stock. Ira Unschuld’s fund, Brant Point Investment Management, also dropped its stock, about $1.6 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 3 funds last quarter.
Let’s go over hedge fund activity in other stocks similar to Unisys Corporation (NYSE:UIS). These stocks are Monmouth R.E. Inv. Corp. (NYSE:MNR), Matrix Service Co (NASDAQ:MTRX), Heritage Insurance Holdings Inc (NYSE:HRTG), and Gran Tierra Energy Inc. (NYSEAMEX:GTE). All of these stocks’ market caps are similar to UIS’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MNR | 8 | 23166 | -1 |
| MTRX | 14 | 81195 | 1 |
| HRTG | 13 | 85175 | 1 |
| GTE | 16 | 120028 | -1 |
As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $77 million. That figure was $96 million in UIS’s case. Gran Tierra Energy Inc. (NYSEAMEX:GTE) is the most popular stock in this table. On the other hand Monmouth R.E. Inv. Corp. (NYSE:MNR) is the least popular one with only 8 bullish hedge fund positions. Unisys Corporation (NYSE:UIS) 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 GTE might be a better candidate to consider a long position.
