“Since 2006, value stocks (IVE vs IVW) have underperformed 11 of the 13 calendar years and when they beat growth, it wasn’t by much. Cumulatively, through this week, it has been a 122% differential (up 52% for value vs up 174% for growth). This appears to be the longest and most severe drought for value investors since data collection began. It will go our way eventually as there are too many people paying far too much for today’s darlings, both public and private. Further, the ten-year yield of 2.5% (pre-tax) isn’t attractive nor is real estate. We believe the value part of the global equity market is the only place to earn solid risk adjusted returns and we believe those returns will be higher than normal,” said Vilas Fund in its Q1 investor letter. We aren’t sure whether value stocks outperform growth, but we follow hedge fund investor letters to understand where the markets and stocks might be going. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Regency Centers Corp (NYSE:REG).
Regency Centers Corp (NYSE:REG) investors should pay attention to an increase in hedge fund interest recently. REG was in 16 hedge funds’ portfolios at the end of the third quarter of 2019. There were 12 hedge funds in our database with REG holdings at the end of the previous quarter. Our calculations also showed that REG 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.
In the 21st century investor’s toolkit there are a lot of methods stock traders put to use to appraise their holdings. A couple of the most under-the-radar methods are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the best picks of the top investment managers can trounce their index-focused peers by a very impressive amount (see the details here).
Jim Simons of Renaissance Technologies
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 glance at the key hedge fund action regarding Regency Centers Corp (NYSE:REG).
What does smart money think about Regency Centers Corp (NYSE:REG)?
At Q3’s end, a total of 16 of the hedge funds tracked by Insider Monkey were long this stock, a change of 33% from the previous quarter. On the other hand, there were a total of 18 hedge funds with a bullish position in REG a year ago. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Renaissance Technologies has the biggest position in Regency Centers Corp (NYSE:REG), worth close to $120.9 million, comprising 0.1% of its total 13F portfolio. Coming in second is D E Shaw, led by David E. Shaw, holding a $54.7 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedge funds and institutional investors that are bullish comprise Ken Griffin’s Citadel Investment Group, Phill Gross and Robert Atchinson’s Adage Capital Management and David Harding’s Winton Capital Management. In terms of the portfolio weights assigned to each position Neo Ivy Capital allocated the biggest weight to Regency Centers Corp (NYSE:REG), around 0.56% of its 13F portfolio. Element Capital Management is also relatively very bullish on the stock, earmarking 0.12 percent of its 13F equity portfolio to REG.
As one would reasonably expect, specific money managers have jumped into Regency Centers Corp (NYSE:REG) headfirst. GAMCO Investors, managed by Mario Gabelli, created the largest position in Regency Centers Corp (NYSE:REG). GAMCO Investors had $1 million invested in the company at the end of the quarter. Renee Yao’s Neo Ivy Capital also initiated a $0.9 million position during the quarter. The other funds with brand new REG positions are Michael Gelband’s ExodusPoint Capital, Thomas Bailard’s Bailard Inc, and Matthew Tewksbury’s Stevens Capital Management.
Let’s check out hedge fund activity in other stocks similar to Regency Centers Corp (NYSE:REG). We will take a look at Cenovus Energy Inc (NYSE:CVE), Continental Resources, Inc. (NYSE:CLR), Alleghany Corporation (NYSE:Y), and C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW). This group of stocks’ market values are similar to REG’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CVE | 25 | 635156 | 8 |
| CLR | 37 | 434858 | 3 |
| Y | 26 | 404893 | 0 |
| CHRW | 23 | 300442 | 3 |
| Average | 27.75 | 443837 | 3.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 27.75 hedge funds with bullish positions and the average amount invested in these stocks was $444 million. That figure was $234 million in REG’s case. Continental Resources, Inc. (NYSE:CLR) is the most popular stock in this table. On the other hand C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) is the least popular one with only 23 bullish hedge fund positions. Compared to these stocks Regency Centers Corp (NYSE:REG) is even less popular than CHRW. Hedge funds dodged a bullet by taking a bearish stance towards REG. Our calculations showed that the top 20 most popular hedge fund stocks returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately REG wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); REG investors were disappointed as the stock returned -5.6% 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 70 percent of these stocks already outperformed the market so far in Q4.
Disclosure: None. This article was originally published at Insider Monkey.
