The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of June 28. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Commscope Holding Company Inc (NASDAQ:COMM).
Is Commscope Holding Company Inc (NASDAQ:COMM) a buy here? Hedge funds are taking a pessimistic view. The number of long hedge fund positions decreased by 3 lately. Our calculations also showed that COMM isn’t among the 30 most popular stocks among hedge funds (see the video below).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most market participants, hedge funds are assumed to be unimportant, old investment tools of yesteryear. While there are more than 8000 funds in operation at the moment, Our researchers look at the elite of this club, around 750 funds. These hedge fund managers oversee most of the smart money’s total asset base, and by monitoring their top picks, Insider Monkey has determined several investment strategies that have historically outstripped the S&P 500 index. Insider Monkey’s flagship hedge fund strategy outpaced the S&P 500 index by around 5 percentage points a year since its inception in May 2014. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 25.7% since February 2017 (through September 30th) even though the market was up more than 33% during the same period. We just shared a list of 10 short targets in our latest quarterly update .
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. We’re going to go over the fresh hedge fund action encompassing Commscope Holding Company Inc (NASDAQ:COMM).
What have hedge funds been doing with Commscope Holding Company Inc (NASDAQ:COMM)?
Heading into the third quarter of 2019, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of -13% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards COMM over the last 16 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Maverick Capital was the largest shareholder of Commscope Holding Company Inc (NASDAQ:COMM), with a stake worth $291.2 million reported as of the end of March. Trailing Maverick Capital was FPR Partners, which amassed a stake valued at $202.9 million. Adage Capital Management, AQR Capital Management, and Citadel Investment Group were also very fond of the stock, giving the stock large weights in their portfolios.
Since Commscope Holding Company Inc (NASDAQ:COMM) has witnessed a decline in interest from the smart money, it’s safe to say that there lies a certain “tier” of money managers who were dropping their positions entirely last quarter. Intriguingly, William Duhamel’s Route One Investment Company dumped the largest investment of all the hedgies monitored by Insider Monkey, comprising an estimated $189.3 million in stock. Peter Rathjens, Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also dropped its stock, about $36.4 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 3 funds last quarter.
Let’s go over hedge fund activity in other stocks similar to Commscope Holding Company Inc (NASDAQ:COMM). We will take a look at MorphoSys AG (NASDAQ:MOR), Cleveland-Cliffs Inc (NYSE:CLF), RLJ Lodging Trust (NYSE:RLJ), and Liberty Latin America Ltd. (NASDAQ:LILAK). All of these stocks’ market caps are closest to COMM’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MOR | 6 | 37770 | -1 |
| CLF | 28 | 539781 | -7 |
| RLJ | 21 | 179723 | 0 |
| LILAK | 22 | 396567 | 4 |
| Average | 19.25 | 288460 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.25 hedge funds with bullish positions and the average amount invested in these stocks was $288 million. That figure was $811 million in COMM’s case. Cleveland-Cliffs Inc (NYSE:CLF) is the most popular stock in this table. On the other hand MorphoSys AG (NASDAQ:MOR) is the least popular one with only 6 bullish hedge fund positions. Commscope Holding Company Inc (NASDAQ:COMM) 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. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately COMM wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on COMM were disappointed as the stock returned -25.2% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.
