With the third-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the fourth quarter. One of these stocks was Bed Bath & Beyond Inc. (NASDAQ:BBBY).
Is Bed Bath & Beyond Inc. (NASDAQ:BBBY) a cheap investment now? Prominent investors are becoming more confident. The number of long hedge fund bets inched up by 1 in recent months. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Linear Technology Corporation (NASDAQ:LLTC), Sealed Air Corp (NYSE:SEE), and Eastman Chemical Company (NYSE:EMN) to gather more data points.
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In the financial world there are a multitude of gauges stock market investors have at their disposal to grade publicly traded companies. Two of the most useful gauges are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the top picks of the best money managers can outclass the market by a significant margin (see the details here).
Keeping this in mind, we’re going to take a glance at the new action regarding Bed Bath & Beyond Inc. (NASDAQ:BBBY).
What have hedge funds been doing with Bed Bath & Beyond Inc. (NASDAQ:BBBY)?
At Q3’s end, a total of 33 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 3% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Chuck Royce’s Royce & Associates has the biggest position in Bed Bath & Beyond Inc. (NASDAQ:BBBY), worth close to $139.6 million, comprising 0.7% of its total 13F portfolio. On Royce & Associates’s heels is Renaissance Technologies, managed by Jim Simons, which holds a $115.5 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Remaining peers with similar optimism encompass David Harding’s Winton Capital Management, Joel Greenblatt’s Gotham Asset Management and Israel Englander’s Millennium Management.
Consequently, specific money managers were breaking ground themselves. Two Sigma Advisors, managed by John Overdeck and David Siegel, initiated the most valuable position in Bed Bath & Beyond Inc. (NASDAQ:BBBY). Two Sigma Advisors had $31.2 million invested in the company at the end of the quarter. George Hall’s Clinton Group also made a $6.5 million investment in the stock during the quarter. The following funds were also among the new BBBY investors: Gilchrist Berg’s Water Street Capital, Neil Chriss’ Hutchin Hill Capital, and Chao Ku’s Nine Chapters Capital Management.
Let’s also examine hedge fund activity in other stocks similar to Bed Bath & Beyond Inc. (NASDAQ:BBBY). These stocks are Linear Technology Corporation (NASDAQ:LLTC), Sealed Air Corp (NYSE:SEE), Eastman Chemical Company (NYSE:EMN), and C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW). All of these stocks’ market caps are similar to BBBY’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LLTC | 20 | 1637058 | -9 |
| SEE | 49 | 2191952 | -5 |
| EMN | 37 | 1080524 | -2 |
| CHRW | 24 | 785286 | 3 |
As you can see these stocks had an average of 32.5 hedge funds with bullish positions and the average amount invested in these stocks was $1424 million. That figure was $743 million in BBBY’s case. Sealed Air Corp (NYSE:SEE) is the most popular stock in this table. On the other hand Linear Technology Corporation (NASDAQ:LLTC) is the least popular one with only 20 bullish hedge fund positions. Bed Bath & Beyond Inc. (NASDAQ:BBBY) 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. In this regard SEE might be a better candidate to consider a long position.
