How National Storage Affiliates Trust (NSA) Stacks Up Against Similarly Valued Stocks

The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge funds have been producing disappointing net returns in recent years, however that was partly due to the poor performance of small-cap stocks in general. Well, small-cap stocks finally turned the corner and have been beating the large-cap stocks by more than 10 percentage points over the last 5 months.This means the relevancy of hedge funds’ public filings became inarguable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards National Storage Affiliates Trust (NYSE:NSA).

Is National Storage Affiliates Trust (NYSE:NSA) ready to rally soon? Hedge funds seem to be selling as the number of long hedge fund bets (among the investors in our database) decreased by nine during the third quarter. 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 K2M Group Holdings Inc (NASDAQ:KTWO), Just Energy Group, Inc. Ordinary Shares (Canada) (NYSE:JE), and Viad Corp (NYSE:VVI) to gather more data points.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

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Keeping this in mind, we’re going to take a look at the recent action encompassing National Storage Affiliates Trust (NYSE:NSA).

What does the smart money think about National Storage Affiliates Trust (NYSE:NSA)?

At the end of the third quarter, a total of 12 of the hedge funds tracked by Insider Monkey held long positions in this stock, versus 21 funds at the end of June. Below, you can check out the change in hedge fund sentiment towards NSA over the last 5 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, J. Alan Reid, Jr.’s Forward Management has the largest position in National Storage Affiliates Trust (NYSE:NSA), worth close to $25 million, corresponding to 1.9% of its total 13F portfolio. The second most bullish fund manager is Cardinal Capital, led by Amy Minella, which holds a $22 million position; 1% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors that hold long positions consist of Renaissance Technologies, one of the largest hedge funds in the world, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Cliff Asness’ AQR Capital Management. We should note that Forward Management is among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

Judging by the fact that National Storage Affiliates Trust (NYSE:NSA) has weathered declining sentiment from the smart money, it’s easy to see that there is a sect of fund managers that elected to cut their entire stakes last quarter. Interestingly, Stuart J. Zimmer’s Zimmer Partners got rid of the biggest stake of the “upper crust” of funds tracked by Insider Monkey, worth an estimated $19.7 million in stock. Michael Swotes’s fund, Castle Ridge Investment Management, also said goodbye to its stock, about $8.1 million worth.

Let’s go over hedge fund activity in other stocks similar to National Storage Affiliates Trust (NYSE:NSA). These stocks are K2M Group Holdings Inc (NASDAQ:KTWO), Just Energy Group, Inc. Ordinary Shares (Canada) (NYSE:JE), Viad Corp (NYSE:VVI), and National Western Life Insurance Company (NASDAQ:NWLI). This group of stocks’ market valuations are similar to NSA’s market valuation.

As you can see these stocks had an average of 10 funds with bullish positions and the average amount invested in these stocks was $52 million. That figure was $69 million in NSA’s case. Viad Corp (NYSE:VVI) 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 seven bullish hedge fund positions. National Storage Affiliates Trust (NYSE:NSA) 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, Viad Corp (NYSE:VVI) might be a better candidate to consider taking a long position in.

Disclosure: none