Hedge Funds Are Buying Delphi Automotive PLC (DLPH)

Does Delphi Automotive PLC (NYSE:DLPH) represent a good buying opportunity at the moment? Let’s briefly check the hedge fund sentiment towards the company. Hedge fund firms constantly search out bright intellectuals and highly-experienced employees and throw away millions of dollars on research activities, so it is no wonder why they tend to generate millions in profits each year. It is also true that some hedge fund players fail unconceivably on some occasions, but their stock picks have been generating superior risk-adjusted returns on average over the years.

Is Delphi Automotive PLC (NYSE:DLPH) ready to rally soon? Hedge funds are in an optimistic mood. The number of bullish hedge fund positions inched up by 4 in recent months. DLPH was in 34 hedge funds’ portfolios at the end of September. There were 30 hedge funds in our database with DLPH holdings at the end of the previous quarter. At the end of this article we will also compare DLPH to other stocks including Tenaris S.A. (ADR) (NYSE:TS), Continental Resources, Inc. (NYSE:CLR), and Mead Johnson Nutrition CO (NYSE:MJN) to get a better sense of its popularity.

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Now, we’re going to take a look at the new action surrounding Delphi Automotive PLC (NYSE:DLPH).

What have hedge funds been doing with Delphi Automotive PLC (NYSE:DLPH)?

At Q3’s end, a total of 34 of the hedge funds tracked by Insider Monkey were long this stock, a change of 13% from one quarter earlier. With the smart money’s sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Doug Silverman and Alexander Klabin’s Senator Investment Group has the most valuable position in Delphi Automotive PLC (NYSE:DLPH), worth close to $316.8 million, accounting for 4.2% of its total 13F portfolio. Sitting at the No. 2 spot is Anchor Bolt Capital, led by Robert Polak, holding a $64.1 million position; the fund has 2% of its 13F portfolio invested in the stock. Other hedge funds and institutional investors that are bullish comprise John W. Moon’s Moon Capital and Ian Simm’s Impax Asset Management.

As aggregate interest increased, key hedge funds were leading the bulls’ herd. Balyasny Asset Management, managed by Dmitry Balyasny, initiated the most valuable position in Delphi Automotive PLC (NYSE:DLPH). Balyasny Asset Management had $40.3 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also made a $23 million investment in the stock during the quarter. The other funds with new positions in the stock are Ken Griffin’s Citadel Investment Group, Solomon Kumin’s Folger Hill Asset Management, and Matthew Lindenbaum’s Basswood Capital.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Delphi Automotive PLC (NYSE:DLPH) but similarly valued. These stocks are Tenaris S.A. (ADR) (NYSE:TS), Continental Resources, Inc. (NYSE:CLR), Mead Johnson Nutrition CO (NYSE:MJN), and Marriott International Inc (NYSE:MAR). All of these stocks’ market caps match DLPH’s market cap.

As you can see these stocks had an average of 33.75 hedge funds with bullish positions and the average amount invested in these stocks was $1.01 billion. That figure was $650 million in DLPH’s case. Marriott International Inc (NYSE:MAR) is the most popular stock in this table. On the other hand Tenaris S.A. (ADR) (NYSE:TS) is the least popular one with only 10 bullish hedge fund positions. Delphi Automotive PLC (NYSE:DLPH) 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 MAR might be a better candidate to consider a long position.