The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing more than 750 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30th, 2019. What do these smart investors think about Covia Holdings Corporation (NYSE:CVIA)?
Covia Holdings Corporation (NYSE:CVIA) investors should pay attention to an increase in enthusiasm from smart money lately. Our calculations also showed that CVIA isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the Russell 2000 ETFs by 40 percentage points since May 2014 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.8% through November 21, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Israel Englander of Millennium Management
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds‘ buy/sell signals. Let’s take a peek at the key hedge fund action regarding Covia Holdings Corporation (NYSE:CVIA).
Hedge fund activity in Covia Holdings Corporation (NYSE:CVIA)
At Q3’s end, a total of 8 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from the second quarter of 2019. By comparison, 7 hedge funds held shares or bullish call options in CVIA a year ago. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, SailingStone Capital Partners, managed by MacKenzie B. Davis and Kenneth L. Settles Jr, holds the most valuable position in Covia Holdings Corporation (NYSE:CVIA). SailingStone Capital Partners has a $10.5 million position in the stock, comprising 2.7% of its 13F portfolio. The second largest stake is held by Millennium Management, managed by Israel Englander, which holds a $2.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that hold long positions include Renaissance Technologies, Brian C. Freckmann’s Lyon Street Capital and Donald Sussman’s Paloma Partners. In terms of the portfolio weights assigned to each position SailingStone Capital Partners allocated the biggest weight to Covia Holdings Corporation (NYSE:CVIA), around 2.68% of its 13F portfolio. Lyon Street Capital is also relatively very bullish on the stock, designating 1.54 percent of its 13F equity portfolio to CVIA.
Consequently, key hedge funds have jumped into Covia Holdings Corporation (NYSE:CVIA) headfirst. Lyon Street Capital, managed by Brian C. Freckmann, established the largest position in Covia Holdings Corporation (NYSE:CVIA). Lyon Street Capital had $0.8 million invested in the company at the end of the quarter. Donald Sussman’s Paloma Partners also initiated a $0.1 million position during the quarter. The other funds with new positions in the stock are Michael Gelband’s ExodusPoint Capital, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and David E. Shaw’s D E Shaw.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Covia Holdings Corporation (NYSE:CVIA) but similarly valued. We will take a look at Avid Technology, Inc. (NASDAQ:AVID), Leju Holdings Ltd (NYSE:LEJU), Xeris Pharmaceuticals, Inc. (NASDAQ:XERS), and Northrim BanCorp, Inc. (NASDAQ:NRIM). All of these stocks’ market caps resemble CVIA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AVID | 13 | 39069 | 0 |
| LEJU | 1 | 2529 | -1 |
| XERS | 4 | 53600 | -1 |
| NRIM | 7 | 29237 | -1 |
| Average | 6.25 | 31109 | -0.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.25 hedge funds with bullish positions and the average amount invested in these stocks was $31 million. That figure was $15 million in CVIA’s case. Avid Technology, Inc. (NASDAQ:AVID) is the most popular stock in this table. On the other hand Leju Holdings Ltd (NYSE:LEJU) is the least popular one with only 1 bullish hedge fund positions. Covia Holdings Corporation (NYSE:CVIA) 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 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately CVIA wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on CVIA were disappointed as the stock returned -26.2% during the fourth quarter (through the end of November) 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.
