Is Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI) a good investment right now? We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, expert networks, and get tips from industry insiders. They sometimes fail miserably but historically their consensus stock picks outperformed the market after adjusting for known risk factors.
Hedge fund interest in Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI) shares was flat at the end of last quarter. This is usually a negative indicator. 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 InVitae Corporation (NYSE:NVTA), Knoll Inc (NYSE:KNL), and National Bank Holdings Corp (NYSE:NBHC) to gather more data points.
In the financial world there are a large number of gauges market participants can use to analyze publicly traded companies. A couple of the most innovative gauges are hedge fund and insider trading moves. We have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce the market by a solid amount (see the details here).
We’re going to check out the fresh hedge fund action surrounding Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI).
Hedge fund activity in Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI)
Heading into the fourth quarter of 2018, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, no change from one quarter earlier. By comparison, 9 hedge funds held shares or bullish call options in HASI heading into this year. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Philip Hempleman’s Ardsley Partners has the most valuable position in Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI), worth close to $7.6 million, corresponding to 1% of its total 13F portfolio. The second most bullish fund manager is John Osterweis of Osterweis Capital Management, with a $7.3 million position; 0.5% of its 13F portfolio is allocated to the company. Other professional money managers with similar optimism encompass Daniel Arbess’s Perella Weinberg Partners, Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners and Ken Griffin’s Citadel Investment Group.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Renaissance Technologies. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Citadel Investment Group).
Let’s now review hedge fund activity in other stocks similar to Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI). We will take a look at InVitae Corporation (NYSE:NVTA), Knoll Inc (NYSE:KNL), National Bank Holdings Corp (NYSE:NBHC), and National Western Life Insurance Company (NASDAQ:NWLI). This group of stocks’ market caps resemble HASI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NVTA | 20 | 318967 | 7 |
| KNL | 14 | 42034 | 1 |
| NBHC | 9 | 97149 | 0 |
| NWLI | 7 | 20438 | -1 |
| Average | 12.5 | 119647 | 1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.5 hedge funds with bullish positions and the average amount invested in these stocks was $120 million. That figure was $16 million in HASI’s case. InVitae Corporation (NYSE:NVTA) is the most popular stock in this table. On the other hand National Western Life Insurance Company (NASDAQ:NWLI) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Hannon Armstrong Sustnbl Infrstr Cap Inc (NYSE:HASI) is even less popular than NWLI. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.
Disclosure: None. This article was originally published at Insider Monkey.
