After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of December 31. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Bloomin’ Brands Inc (NASDAQ:BLMN).
Is Bloomin’ Brands Inc (NASDAQ:BLMN) worth your attention right now? Investors who are in the know are in a pessimistic mood. The number of long hedge fund bets were cut by 4 in recent months. Our calculations also showed that blmn 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 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 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.
We’re going to check out the recent hedge fund action encompassing Bloomin’ Brands Inc (NASDAQ:BLMN).
Hedge fund activity in Bloomin’ Brands Inc (NASDAQ:BLMN)
At the end of the fourth quarter, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -15% from one quarter earlier. On the other hand, there were a total of 24 hedge funds with a bullish position in BLMN a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Millennium Management was the largest shareholder of Bloomin’ Brands Inc (NASDAQ:BLMN), with a stake worth $61.2 million reported as of the end of December. Trailing Millennium Management was Citadel Investment Group, which amassed a stake valued at $53.7 million. D E Shaw, Balyasny Asset Management, and GLG Partners were also very fond of the stock, giving the stock large weights in their portfolios.
Due to the fact that Bloomin’ Brands Inc (NASDAQ:BLMN) has experienced bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there exists a select few hedge funds that elected to cut their entire stakes in the third quarter. It’s worth mentioning that Brandon Haley’s Holocene Advisors dropped the biggest investment of all the hedgies followed by Insider Monkey, worth about $19 million in stock. Mark Kingdon’s fund, Kingdon Capital, also dropped its stock, about $10.2 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 4 funds in the third quarter.
Let’s now review hedge fund activity in other stocks similar to Bloomin’ Brands Inc (NASDAQ:BLMN). We will take a look at Sanmina Corporation (NASDAQ:SANM), NetGear, Inc. (NASDAQ:NTGR), Aerie Pharmaceuticals Inc (NASDAQ:AERI), and Arcos Dorados Holding Inc (NYSE:ARCO). This group of stocks’ market valuations resemble BLMN’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SANM | 15 | 158693 | 2 |
| NTGR | 14 | 56299 | -2 |
| AERI | 23 | 628236 | 0 |
| ARCO | 14 | 155551 | -4 |
| Average | 16.5 | 249695 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.5 hedge funds with bullish positions and the average amount invested in these stocks was $250 million. That figure was $269 million in BLMN’s case. Aerie Pharmaceuticals Inc (NASDAQ:AERI) is the most popular stock in this table. On the other hand NetGear, Inc. (NASDAQ:NTGR) is the least popular one with only 14 bullish hedge fund positions. Bloomin’ Brands Inc (NASDAQ:BLMN) 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. 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. Unfortunately BLMN wasn’t nearly as popular as these 15 stock and hedge funds that were betting on BLMN were disappointed as the stock returned 6.9% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
