We at Insider Monkey have gone over 700 13F filings that hedge funds and prominent investors are required to file by the government. The 13F filings show the funds’ and investors’ portfolio positions as of September 30. In this article we look at what those investors think of General Growth Properties Inc (NYSE:GGP).
General Growth Properties Inc (NYSE:GGP) investors should pay attention to an increase in activity from the world’s largest hedge funds of late. GGP was in 27 hedge funds’ portfolios at the end of the third quarter of 2015. There were 22 hedge funds in our database with GGP positions at the end of the previous quarter. At the end of this article we will also compare GGP to other stocks, including Franklin Resources, Inc. (NYSE:BEN), Baker Hughes Incorporated (NYSE:BHI), and Hilton Worldwide Holdings Inc (NYSE:HLT) to get a better sense of its popularity.
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To most market participants, hedge funds are seen as unimportant, old financial tools of years past. While there are over 8000 funds trading today, We hone in on the upper echelon of this club, about 700 funds. Most estimates calculate that this group of people orchestrate the lion’s share of the hedge fund industry’s total asset base, and by monitoring their matchless stock picks, Insider Monkey has deciphered many investment strategies that have historically exceeded Mr. Market. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points per year for a decade in their back tests.
Keeping this in mind, let’s take a look at the latest action encompassing General Growth Properties Inc (NYSE:GGP).
What have hedge funds been doing with General Growth Properties Inc (NYSE:GGP)?
At the end of the third quarter, a total of 27 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 23% from one quarter earlier. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Israel Englander’s Millennium Management has the biggest position in General Growth Properties Inc (NYSE:GGP), worth close to $82.7 million, comprising 0.2% of its total 13F portfolio. Sitting at the No. 2 spot is Jim Simons of Renaissance Technologies, with a $48.1 million position; 0.1% of its 13F portfolio is allocated to the company. Other hedge funds and institutional investors that are bullish contain Phill Gross and Robert Atchinson’s Adage Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Matthew Tewksbury’s Stevens Capital Management.
Consequently, some big names have jumped into General Growth Properties Inc (NYSE:GGP) headfirst. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, initiated the biggest position in General Growth Properties Inc (NYSE:GGP). According to its latest 13F filing, the fund had $18.3 million invested in the company at the end of the quarter. David Costen Haley’s HBK Investments also initiated a $3.9 million position during the quarter. The other funds with brand new GGP positions are Emanuel J. Friedman’s EJF Capital, Ray Dalio’s Bridgewater Associates, and Chao Ku’s Nine Chapters Capital Management.
Let’s go over hedge fund activity in other stocks similar to General Growth Properties Inc (NYSE:GGP). We will take a look at Franklin Resources, Inc. (NYSE:BEN), Baker Hughes Incorporated (NYSE:BHI), Hilton Worldwide Holdings Inc (NYSE:HLT), and Discover Financial Services (NYSE:DFS). This group of stocks’ market valuations resemble GGP’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BEN | 37 | 1811000 | 2 |
| BHI | 53 | 3013440 | -20 |
| HLT | 51 | 1488094 | 0 |
| DFS | 52 | 1900604 | 7 |
As you can see these stocks had an average of 48 hedge funds with bullish positions and the average amount invested in these stocks was $2.05 billion. That figure was a meager $272 million in GGP’s case. Baker Hughes Incorporated (NYSE:BHI) is the most popular stock in this table. On the other hand Franklin Resources, Inc. (NYSE:BEN) is the least popular one with only 37 bullish hedge fund positions. Compared to these stocks, General Growth Properties Inc (NYSE:GGP) is even less popular than BEN. 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.
