How do we determine whether Olympic Steel, Inc. (NASDAQ:ZEUS) makes for a good investment at the moment? We analyze the sentiment of a select group of the very best investors in the world, who spend immense amounts of time and resources studying companies. They may not always be right (no one is), but data shows that their consensus long positions have historically outperformed the market when we adjust for known risk factors.
Is Olympic Steel, Inc. (NASDAQ:ZEUS) going to take off soon? Prominent investors are becoming less hopeful. The number of bullish hedge fund bets fell by 1 in recent months. At the end of this article we will also compare ZEUS to other stocks including Community Bankers Trust Corp. (NASDAQ:ESXB), Houston Wire & Cable Company (NASDAQ:HWCC), and Manning and Napier Inc (NYSE:MN) to get a better sense of its popularity.
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Keeping this in mind, we’re going to take a glance at the key action surrounding Olympic Steel, Inc. (NASDAQ:ZEUS).
Hedge fund activity in Olympic Steel, Inc. (NASDAQ:ZEUS)
At Q3’s end, a total of 9 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Royce & Associates, managed by Chuck Royce, holds the number one position in Olympic Steel, Inc. (NASDAQ:ZEUS). Royce & Associates has an $2.8 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is AQR Capital Management, led by Cliff Asness, holding an $0.6 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other peers that hold long positions encompass Israel Englander’s Millennium Management, and D. E. Shaw’s D E Shaw.
Because Olympic Steel, Inc. (NASDAQ:ZEUS) has faced bearish sentiment from the entirety of the hedge funds we track, logic holds that there is a sect of funds that slashed their entire stakes in the third quarter. It’s worth mentioning that Ken Gray and Steve Walsh’s Bryn Mawr Capital sold off the largest stake of the “upper crust” of funds followed by Insider Monkey, comprising close to $0.4 million in stock, and Peter Muller’s PDT Partners was right behind this move, as the fund sold off about $0.2 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest dropped by 1 funds in the third quarter.
Let’s go over hedge fund activity in other stocks similar to Olympic Steel, Inc. (NASDAQ:ZEUS) on the next page.These stocks are Community Bankers Trust Corp. (NASDAQ:ESXB), Houston Wire & Cable Company (NASDAQ:HWCC), Manning and Napier Inc (NYSE:MN), and CUI Global Inc (NASDAQ:CUI). This group of stocks’ market valuations are closest to ZEUS’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ESXB | 5 | 13802 | 5 |
| HWCC | 9 | 28259 | -1 |
| MN | 11 | 27896 | -3 |
| CUI | 6 | 22546 | -1 |
As you can see these stocks had an average of 7.75 hedge funds with bullish positions and the average amount invested in these stocks was $23 million. That figure was $4 million in ZEUS’s case. Manning and Napier Inc (NYSE:MN) is the most popular stock in this table. On the other hand Community Bankers Trust Corp. (NASDAQ:ESXB) is the least popular one with only 5 bullish hedge fund positions. Olympic Steel, Inc. (NASDAQ:ZEUS) 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 MN might be a better candidate to consider a long position.
