Is Boise Cascade Co (BCC) A Good Stock To Buy?

You probably know from experience that there is not as much information on small-cap companies as there is on large companies. Of course, this makes it really hard and difficult for individual investors to make proper and accurate analysis of certain small-cap companies. However, well-known and successful hedge fund investors like Carl Icahn and George Soros hold the necessary resources and abilities to conduct an extensive stock analysis on small-cap stocks, which enable them to make millions of dollars by identifying potential winners within the small-cap galaxy of stocks. This represents the main reason why Insider Monkey takes notice of the hedge fund activity in these overlooked stocks.

Is Boise Cascade Co (NYSE:BCC) a sound stock to buy now? Prominent investors are altogether getting less bullish. The number of long hedge fund positions that are disclosed in regulatory 13F filings slashed by 1 recently. There were 15 hedge funds in our database with BCC positions at the end of 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 Grupo Supervielle SA -ADR (NYSE:SUPV), Marcus & Millichap Inc (NYSE:MMI), and Surgery Partners Inc (NASDAQ:SGRY) 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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Now, let’s take a peek at the new action regarding Boise Cascade Co (NYSE:BCC).

What does the smart money think about Boise Cascade Co (NYSE:BCC)?

Heading into the fourth quarter of 2016, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, down 6% from the second quarter of 2016. By comparison, 16 hedge funds held shares or bullish call options in BCC heading into this year. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Phill Gross and Robert Atchinson’s Adage Capital Management has the largest position in Boise Cascade Co (NYSE:BCC), worth close to $11.4 million. The second largest stake is held by David E. Shaw’s D E Shaw, worth roughly $8.2 million at the end of the quarter. Other hedge funds and institutional investors with similar optimism encompass David Keidan’s Buckingham Capital Management, John Overdeck and David Siegel’s Two Sigma Advisors and Ken Grossman and Glen Schneider’s SG Capital Management. We should note that SG Capital 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.

Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that cashed in their entire stakes in the stock during the third quarter. It’s worth mentioning that Michael Platt and William Reeves’s BlueCrest Capital Mgmt. cashed in the largest position of all the investors tracked by Insider Monkey, comprising about $2.2 million in stock. Jim Simons’s fund, Renaissance Technologies, also sold off its stock, about $1.7 million worth of BCC shares.

Let’s now review hedge fund activity in other stocks similar to Boise Cascade Co (NYSE:BCC). These stocks are Grupo Supervielle SA -ADR (NYSE:SUPV), Marcus & Millichap Inc (NYSE:MMI), Surgery Partners Inc (NASDAQ:SGRY), and Lannett Company, Inc. (NYSEAMEX:LCI). This group of stocks’ market caps match BCC’s market cap.

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $95 million. That figure was $51 million in BCC’s case. Lannett Company, Inc. (NYSEAMEX:LCI) is the most popular stock in this table. On the other hand Surgery Partners Inc (NASDAQ:SGRY) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Boise Cascade Co (NYSE:BCC) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

Disclosure: None