Here is What Hedge Funds Think About Atlas Air Worldwide Holdings, Inc. (AAWW)

The Insider Monkey team has completed processing the quarterly 13F filings for the June quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW).

Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) investors should be aware of a decrease in hedge fund sentiment of late. Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) was in 26 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 35. Our calculations also showed that AAWW isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 185.4% since March 2017 and outperformed the S&P 500 ETFs by more than 79 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

Chuck Royce of Royce & Associates

Now we’re going to analyze the fresh hedge fund action regarding Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW).

Do Hedge Funds Think AAWW Is A Good Stock To Buy Now?

At second quarter’s end, a total of 26 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -10% from the first quarter of 2020. By comparison, 26 hedge funds held shares or bullish call options in AAWW a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).

Among these funds, Greenlight Capital held the most valuable stake in Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), which was worth $103.2 million at the end of the second quarter. On the second spot was Hill City Capital which amassed $97.7 million worth of shares. Royce & Associates, Fisher Asset Management, and Renaissance Technologies 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 City Capital allocated the biggest weight to Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), around 29.61% of its 13F portfolio. Brightline Capital is also relatively very bullish on the stock, setting aside 9.17 percent of its 13F equity portfolio to AAWW.

Judging by the fact that Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) has faced declining sentiment from hedge fund managers, it’s easy to see that there were a few funds that slashed their entire stakes last quarter. Intriguingly, Len Kipp and Xavier Majic’s Maple Rock Capital sold off the biggest investment of all the hedgies watched by Insider Monkey, valued at close to $30.5 million in stock. Frank Fu’s fund, CaaS Capital, also sold off its stock, about $14.4 million worth. These transactions are important to note, as total hedge fund interest was cut by 3 funds last quarter.

Let’s check out hedge fund activity in other stocks similar to Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW). These stocks are McGrath RentCorp (NASDAQ:MGRC), Hercules Capital Inc (NYSE:HTGC), Kaiser Aluminum Corp. (NASDAQ:KALU), Dave & Buster’s Entertainment, Inc. (NASDAQ:PLAY), Lordstown Motors Corp. (NASDAQ:RIDE), Trustmark Corp (NASDAQ:TRMK), and Arcus Biosciences, Inc. (NYSE:RCUS). This group of stocks’ market valuations resemble AAWW’s market valuation.

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As you can see these stocks had an average of 16.1 hedge funds with bullish positions and the average amount invested in these stocks was $152 million. That figure was $345 million in AAWW’s case. Dave & Buster’s Entertainment, Inc. (NASDAQ:PLAY) is the most popular stock in this table. On the other hand Kaiser Aluminum Corp. (NASDAQ:KALU) is the least popular one with only 10 bullish hedge fund positions. Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for AAWW is 68.7. 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. 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 24.9% in 2021 through October 15th and still beat the market by 4.5 percentage points. Hedge funds were also right about betting on AAWW as the stock returned 15.5% since the end of Q2 (through 10/15) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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Disclosure: None. This article was originally published at Insider Monkey.