World-class money managers like Bill Ackman and Barry Rosenstein only invest their wealthy clients’ money after undertaking a rigorous examination of any potential stock. They are particularly successful in this regard when it comes to small-cap stocks, which their peerless research gives them a big information advantage on when it comes to judging their worth. It’s not surprising then that they generate their biggest returns from these stocks and invest more of their money in these stocks on average than other investors. It’s also not surprising then that we pay close attention to these picks ourselves and have built a market-beating investment strategy around them.
Hedge fund interest in Capital Senior Living Corporation (NYSE:CSU) shares was flat at the end of last quarter. This is usually a negative indicator. 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 ePlus Inc. (NASDAQ:PLUS), 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS), and Avianca Holdings SA (ADR) (NYSE:AVH) to gather more data points.
Follow Sonida Senior Living Inc. (NYSE:SNDA)
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At the moment there are tons of gauges shareholders use to grade stocks. A pair of the best gauges is composed of hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the top picks of the best fund managers can outperform their index-focused peers by a superb margin (see the details here).
Now, let’s take a gander at the new action regarding Capital Senior Living Corporation (NYSE:CSU).
How are hedge funds trading Capital Senior Living Corporation (NYSE:CSU)?
Heading into Q4, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the second quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Paul J. Isaac’s Arbiter Partners Capital Management has the biggest position in Capital Senior Living Corporation (NYSE:CSU), worth close to $46.9 million, accounting for 4.6% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, managed by Jim Simons, which holds a $15.3 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other members of the smart money that are bullish contain Richard S. Meisenberg’s ACK Asset Management, Mitch Cantor’s Mountain Lake Investment Management, and Joseph Edelman’s Perceptive Advisors.
Due to the fact that Capital Senior Living Corporation (NYSE:CSU) has witnessed declining sentiment from the smart money, it’s safe to say that there is a sect of fund managers who were dropping their entire stakes heading into Q4. It’s worth mentioning that Louis Bacon’s Moore Global Investments dumped the biggest investment of the 700 funds tracked by Insider Monkey, totaling an estimated $4.9 million in stock. Gavin Saitowitz and Cisco J. del Valle’s fund, Springbok Capital, also dumped its stock, about $1.1 million worth. These transactions are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s now take a look at hedge fund activity in other stocks similar to Capital Senior Living Corporation (NYSE:CSU). We will take a look at ePlus Inc. (NASDAQ:PLUS), 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS), Avianca Holdings SA (ADR) (NYSE:AVH), and WCI Communities Inc (NYSE:WCIC). All of these stocks’ market caps are closest to CSU’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PLUS | 12 | 31278 | -2 |
| FLWS | 11 | 32963 | -9 |
| AVH | 4 | 2605 | 0 |
| WCIC | 22 | 165193 | 8 |
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $58 million. That figure was $145 million in CSU’s case. The least popular stock in this table is Avianca Holdings SA (ADR) (NYSE:AVH) , while the most popular one is WCI Communities Inc (NYSE:WCIC). In comparison, Capital Senior Living Corporation (NYSE:CSU) with 19 bullish hedge fund positions is not the most popular stock in this group but it has still attracted attention from investors. Although this may imply it is a stock worth considering, we’d rather spend our time researching stocks that hedge funds are collectively fondest of, and in this case, WCIC might be a better alternative.
