Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track more than 700 prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ recent losses in Facebook. Let’s take a closer look at what the funds we track think about Masonite International Corp (NYSE:DOOR) in this article.
Masonite International Corp (NYSE:DOOR) investors should pay attention to an increase in hedge fund sentiment lately. Our calculations also showed that DOOR isn’t among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 6.3% year to date (through December 3rd) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 18 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to take a look at the recent hedge fund action surrounding Masonite International Corp (NYSE:DOOR).
What does the smart money think about Masonite International Corp (NYSE:DOOR)?
At Q3’s end, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 31% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards DOOR over the last 13 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Masonite International Corp (NYSE:DOOR) was held by Praesidium Investment Management Company, which reported holding $104.1 million worth of stock at the end of September. It was followed by Pzena Investment Management with a $65.5 million position. Other investors bullish on the company included PAR Capital Management, Sunriver Management, and Hound Partners.
As industrywide interest jumped, key hedge funds have jumped into Masonite International Corp (NYSE:DOOR) headfirst. GLG Partners, managed by Noam Gottesman, established the largest position in Masonite International Corp (NYSE:DOOR). GLG Partners had $4.7 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also initiated a $0.8 million position during the quarter. The only other fund with a new position in the stock is Paul Marshall and Ian Wace’s Marshall Wace LLP.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Masonite International Corp (NYSE:DOOR) but similarly valued. These stocks are Advanced Drainage Systems, Inc. (NYSE:WMS), American Assets Trust, Inc (NYSE:AAT), Capitol Federal Financial, Inc. (NASDAQ:CFFN), and ESCO Technologies Inc. (NYSE:ESE). This group of stocks’ market caps are closest to DOOR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WMS | 17 | 374714 | 1 |
| AAT | 11 | 130155 | -5 |
| CFFN | 12 | 198424 | 2 |
| ESE | 6 | 6217 | 3 |
| Average | 11.5 | 177378 | 0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 11.5 hedge funds with bullish positions and the average amount invested in these stocks was $177 million. That figure was $339 million in DOOR’s case. Advanced Drainage Systems, Inc. (NYSE:WMS) is the most popular stock in this table. On the other hand ESCO Technologies Inc. (NYSE:ESE) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks Masonite International Corp (NYSE:DOOR) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: None. This article was originally published at Insider Monkey.
