Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of CoreSite Realty Corp (NYSE:COR).
CoreSite Realty Corp (NYSE:COR) has seen an increase in activity from the world’s largest hedge funds of late. Our calculations also showed that COR isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 58 percentage points since March 2017 (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 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Dmitry Balyasny of Balyasny Asset Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let’s take a glance at the fresh hedge fund action regarding CoreSite Realty Corp (NYSE:COR).
How are hedge funds trading CoreSite Realty Corp (NYSE:COR)?
At Q1’s end, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of 10% from the previous quarter. The graph below displays the number of hedge funds with bullish position in COR over the last 18 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Renaissance Technologies held the most valuable stake in CoreSite Realty Corp (NYSE:COR), which was worth $106.7 million at the end of the third quarter. On the second spot was Citadel Investment Group which amassed $85.3 million worth of shares. Fisher Asset Management, Winton Capital Management, and Two Sigma Advisors 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 Hill Winds Capital allocated the biggest weight to CoreSite Realty Corp (NYSE:COR), around 6.38% of its 13F portfolio. Marlowe Partners is also relatively very bullish on the stock, dishing out 3.52 percent of its 13F equity portfolio to COR.
Consequently, specific money managers have jumped into CoreSite Realty Corp (NYSE:COR) headfirst. Balyasny Asset Management, managed by Dmitry Balyasny, established the most outsized position in CoreSite Realty Corp (NYSE:COR). Balyasny Asset Management had $6.6 million invested in the company at the end of the quarter. David Steinberg and Eric Udoff’s Marlowe Partners also made a $5.2 million investment in the stock during the quarter. The following funds were also among the new COR investors: Bruce Kovner’s Caxton Associates LP, Mike Vranos’s Ellington, and Steve Cohen’s Point72 Asset Management.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as CoreSite Realty Corp (NYSE:COR) but similarly valued. We will take a look at Chegg Inc (NYSE:CHGG), Robert Half International Inc. (NYSE:RHI), Flowers Foods, Inc. (NYSE:FLO), and National Instruments Corporation (NASDAQ:NATI). All of these stocks’ market caps are closest to COR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CHGG | 34 | 302599 | -5 |
| RHI | 26 | 247265 | 3 |
| FLO | 27 | 227639 | 7 |
| NATI | 29 | 706256 | -1 |
| Average | 29 | 370940 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29 hedge funds with bullish positions and the average amount invested in these stocks was $371 million. That figure was $267 million in COR’s case. Chegg Inc (NYSE:CHGG) is the most popular stock in this table. On the other hand Robert Half International Inc. (NYSE:RHI) is the least popular one with only 26 bullish hedge fund positions. Compared to these stocks CoreSite Realty Corp (NYSE:COR) is even less popular than RHI. Hedge funds dodged a bullet by taking a bearish stance towards COR. Our calculations showed that the top 10 most popular hedge fund stocks returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th but managed to beat the market by 14.2 percentage points. Unfortunately COR wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); COR investors were disappointed as the stock returned 5.3% during the second quarter (through June 10th) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.
Follow Coresite Realty Corp (NYSE:COR)
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Disclosure: None. This article was originally published at Insider Monkey.
