Is American Assets Trust, Inc (NYSE:AAT) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.
American Assets Trust, Inc (NYSE:AAT) was in 11 hedge funds’ portfolios at the end of September. AAT has experienced a decrease in activity from the world’s largest hedge funds recently. There were 16 hedge funds in our database with AAT positions at the end of the previous quarter. Our calculations also showed that aat isn’t among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 6.3% year to date (through December 3rd) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 18 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Let’s review the new hedge fund action surrounding American Assets Trust, Inc (NYSE:AAT).
What have hedge funds been doing with American Assets Trust, Inc (NYSE:AAT)?
At Q3’s end, a total of 11 of the hedge funds tracked by Insider Monkey were long this stock, a change of -31% from the second quarter of 2018. The graph below displays the number of hedge funds with bullish position in AAT over the last 13 quarters. So, let’s find out 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, Jeffrey Furber’s AEW Capital Management has the biggest position in American Assets Trust, Inc (NYSE:AAT), worth close to $78.1 million, corresponding to 2.2% of its total 13F portfolio. Coming in second is Noam Gottesman of GLG Partners, with a $30.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions encompass Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group and D. E. Shaw’s D E Shaw.
Judging by the fact that American Assets Trust, Inc (NYSE:AAT) has experienced falling interest from the aggregate hedge fund industry, we can see that there exists a select few fund managers who were dropping their positions entirely last quarter. It’s worth mentioning that Matthew Tewksbury’s Stevens Capital Management dumped the biggest position of all the hedgies watched by Insider Monkey, totaling close to $0.6 million in stock. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also dumped its stock, about $0.6 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest fell by 5 funds last quarter.
Let’s now take a look at hedge fund activity in other stocks similar to American Assets Trust, Inc (NYSE:AAT). We will take a look at Capitol Federal Financial, Inc. (NASDAQ:CFFN), ESCO Technologies Inc. (NYSE:ESE), Fanhua Inc. (NASDAQ:FANH), and Portola Pharmaceuticals Inc (NASDAQ:PTLA). This group of stocks’ market valuations are similar to AAT’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CFFN | 12 | 198424 | 2 |
| ESE | 6 | 6217 | 3 |
| FANH | 4 | 9984 | -1 |
| PTLA | 23 | 455027 | 5 |
| Average | 11.25 | 167413 | 2.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 11.25 hedge funds with bullish positions and the average amount invested in these stocks was $167 million. That figure was $130 million in AAT’s case. Portola Pharmaceuticals Inc (NASDAQ:PTLA) is the most popular stock in this table. On the other hand Fanhua Inc. (NASDAQ:FANH) is the least popular one with only 4 bullish hedge fund positions. American Assets Trust, Inc (NYSE:AAT) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard PTLA might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.
