Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of December. At Insider Monkey, we follow nearly 750 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Helix Energy Solutions Group Inc. (NYSE:HLX), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Helix Energy Solutions Group Inc. (NYSE:HLX) shareholders have witnessed an increase in enthusiasm from smart money in recent months. HLX was in 18 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 16 hedge funds in our database with HLX positions at the end of the previous quarter. Our calculations also showed that HLX isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We’re going to take a glance at the latest hedge fund action encompassing Helix Energy Solutions Group Inc. (NYSE:HLX).
How have hedgies been trading Helix Energy Solutions Group Inc. (NYSE:HLX)?
At Q4’s end, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 13% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards HLX over the last 14 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
Among these funds, Millennium Management held the most valuable stake in Helix Energy Solutions Group Inc. (NYSE:HLX), which was worth $18.7 million at the end of the fourth quarter. On the second spot was Renaissance Technologies which amassed $5.4 million worth of shares. Moreover, Gotham Asset Management, Selz Capital, and Marshall Wace LLP were also bullish on Helix Energy Solutions Group Inc. (NYSE:HLX), allocating a large percentage of their portfolios to this stock.
As industrywide interest jumped, specific money managers were leading the bulls’ herd. Empyrean Capital Partners, managed by Michael A. Price and Amos Meron, established the largest position in Helix Energy Solutions Group Inc. (NYSE:HLX). Empyrean Capital Partners had $2.3 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also initiated a $1.9 million position during the quarter. The other funds with brand new HLX positions are Paul Marshall and Ian Wace’s Marshall Wace LLP, Benjamin A. Smith’s Laurion Capital Management, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Helix Energy Solutions Group Inc. (NYSE:HLX) but similarly valued. We will take a look at QuinStreet Inc (NASDAQ:QNST), The St. Joe Company (NYSE:JOE), Tutor Perini Corp (NYSE:TPC), and Career Education Corp. (NASDAQ:CECO). This group of stocks’ market values match HLX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| QNST | 27 | 233274 | -1 |
| JOE | 12 | 383512 | -3 |
| TPC | 7 | 6806 | 0 |
| CECO | 22 | 125143 | 5 |
| Average | 17 | 187184 | 0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $187 million. That figure was $34 million in HLX’s case. QuinStreet Inc (NASDAQ:QNST) is the most popular stock in this table. On the other hand Tutor Perini Corp (NYSE:TPC) is the least popular one with only 7 bullish hedge fund positions. Helix Energy Solutions Group Inc. (NYSE:HLX) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Hedge funds were also right about betting on HLX as the stock returned 58.8% and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.
