Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Ferro Corporation (NYSE:FOE) based on that data.
Ferro Corporation (NYSE:FOE) was in 21 hedge funds’ portfolios at the end of September. The all time high for this statistic is 28. FOE investors should pay attention to a decrease in support from the world’s most elite money managers lately. There were 23 hedge funds in our database with FOE holdings at the end of June. Our calculations also showed that FOE isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind let’s go over the fresh hedge fund action surrounding Ferro Corporation (NYSE:FOE).
Alec Litowitz of Magnetar Capital
Do Hedge Funds Think FOE Is A Good Stock To Buy Now?
At the end of September, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -9% from one quarter earlier. By comparison, 15 hedge funds held shares or bullish call options in FOE a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Magnetar Capital was the largest shareholder of Ferro Corporation (NYSE:FOE), with a stake worth $100.7 million reported as of the end of September. Trailing Magnetar Capital was GAMCO Investors, which amassed a stake valued at $75 million. Alpine Associates, Millennium Management, and Water Island Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Alpine Associates allocated the biggest weight to Ferro Corporation (NYSE:FOE), around 1.5% of its 13F portfolio. Halcyon Asset Management is also relatively very bullish on the stock, setting aside 1.45 percent of its 13F equity portfolio to FOE.
Judging by the fact that Ferro Corporation (NYSE:FOE) has witnessed bearish sentiment from hedge fund managers, we can see that there was a specific group of hedge funds that decided to sell off their full holdings in the third quarter. Interestingly, Carl Tiedemann and Michael Tiedemann’s TIG Advisors sold off the biggest investment of the “upper crust” of funds tracked by Insider Monkey, totaling an estimated $36.2 million in stock, and Orkun Kilic’s Berry Street Capital was right behind this move, as the fund dumped about $13.5 million worth. These moves are important to note, as total hedge fund interest dropped by 2 funds in the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Ferro Corporation (NYSE:FOE). We will take a look at MYR Group Inc (NASDAQ:MYRG), Meta Financial Group Inc. (NASDAQ:CASH), CVR Energy, Inc. (NYSE:CVI), Castle Biosciences, Inc. (NASDAQ:CSTL), Allscripts Healthcare Solutions Inc (NASDAQ:MDRX), Avaya Holdings Corp. (NYSE:AVYA), and Alamo Group, Inc. (NYSE:ALG). This group of stocks’ market caps are similar to FOE’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MYRG | 16 | 73888 | 3 |
| CASH | 19 | 146424 | 4 |
| CVI | 16 | 1240474 | 0 |
| CSTL | 15 | 268346 | 1 |
| MDRX | 24 | 211927 | 1 |
| AVYA | 25 | 271469 | -12 |
| ALG | 7 | 200059 | -3 |
| Average | 17.4 | 344655 | -0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.4 hedge funds with bullish positions and the average amount invested in these stocks was $345 million. That figure was $346 million in FOE’s case. Avaya Holdings Corp. (NYSE:AVYA) is the most popular stock in this table. On the other hand Alamo Group, Inc. (NYSE:ALG) is the least popular one with only 7 bullish hedge fund positions. Ferro Corporation (NYSE:FOE) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FOE is 64.4. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and beat the market again by 3.6 percentage points. Unfortunately FOE wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on FOE were disappointed as the stock returned 7.3% since the end of September (through 12/31) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
Follow Ferro Corp (NYSE:FOE)
Follow Ferro Corp (NYSE:FOE)
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Disclosure: None. This article was originally published at Insider Monkey.
