A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended March 31st, so let’s proceed with the discussion of the hedge fund sentiment on The Chemours Company (NYSE:CC).
The Chemours Company (NYSE:CC) investors should be aware of a decrease in hedge fund interest lately. The Chemours Company (NYSE:CC) was in 27 hedge funds’ portfolios at the end of March. The all time high for this statistic is 44. Our calculations also showed that CC isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
David Einhorn of Greenlight Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, economists warn of inflation flare up. So, we are checking out this backdoor gold play that has hit peak gains of 718% in a little over a year. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now let’s review the key hedge fund action surrounding The Chemours Company (NYSE:CC).
Do Hedge Funds Think CC Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 27 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CC over the last 23 quarters. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
More specifically, Sessa Capital was the largest shareholder of The Chemours Company (NYSE:CC), with a stake worth $247.8 million reported as of the end of March. Trailing Sessa Capital was Miller Value Partners, which amassed a stake valued at $62.5 million. Greenlight Capital, Arrowstreet Capital, 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 Sessa Capital allocated the biggest weight to The Chemours Company (NYSE:CC), around 9.55% of its 13F portfolio. Brightline Capital is also relatively very bullish on the stock, designating 8.76 percent of its 13F equity portfolio to CC.
Since The Chemours Company (NYSE:CC) has experienced a decline in interest from the aggregate hedge fund industry, we can see that there were a few hedgies that elected to cut their entire stakes last quarter. At the top of the heap, Paul Tudor Jones’s Tudor Investment Corp said goodbye to the largest stake of the 750 funds monitored by Insider Monkey, totaling an estimated $2.7 million in stock. Greg Eisner’s fund, Engineers Gate Manager, also dumped its stock, about $1.1 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 3 funds last quarter.
Let’s go over hedge fund activity in other stocks similar to The Chemours Company (NYSE:CC). We will take a look at Clean Harbors Inc (NYSE:CLH), Select Medical Holdings Corporation (NYSE:SEM), frontdoor, inc. (NASDAQ:FTDR), HUYA Inc. (NYSE:HUYA), China Biologic Products Holdings Inc (NASDAQ:CBPO), Houlihan Lokey Inc (NYSE:HLI), and Leslie’s, Inc. (NASDAQ:LESL). This group of stocks’ market caps resemble CC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CLH | 27 | 383596 | 5 |
| SEM | 22 | 179000 | 7 |
| FTDR | 36 | 763384 | -1 |
| HUYA | 13 | 335848 | 1 |
| CBPO | 15 | 1001472 | -1 |
| HLI | 16 | 125689 | -10 |
| LESL | 27 | 285809 | 5 |
| Average | 22.3 | 439257 | 0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 22.3 hedge funds with bullish positions and the average amount invested in these stocks was $439 million. That figure was $545 million in CC’s case. frontdoor, inc. (NASDAQ:FTDR) is the most popular stock in this table. On the other hand HUYA Inc. (NYSE:HUYA) is the least popular one with only 13 bullish hedge fund positions. The Chemours Company (NYSE:CC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CC is 50.8. 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% in 2021 through July 9th and still beat the market by 6.7 percentage points. Hedge funds were also right about betting on CC as the stock returned 24.8% since the end of Q1 (through 7/9) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Chemours Co (NYSE:CC)
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Disclosure: None. This article was originally published at Insider Monkey.
