Most investors tend to think that hedge funds and other asset managers are worthless, as they cannot beat even simple index fund portfolios. In fact, most people expect hedge funds to compete with and outperform the bull market that we have witnessed over the past few years. However, hedge funds are generally partially hedged and aim at delivering attractive risk-adjusted returns rather than following the ups and downs of equity markets hoping that they will outperform the broader market. Our research shows that hedge funds do have great stock picking skills, so let’s take a glance at the smart money sentiment towards Chemours Co (NYSE:CC).
Chemours Co (NYSE:CC) was in 24 hedge funds’ portfolios at the end of September. CC investors should pay attention to an increase in enthusiasm from smart money in recent months. There were 10 hedge funds in our database with CC positions at the end of the previous quarter. At the end of this article we will also compare CC to other stocks including Granite Construction Inc. (NYSE:GVA), Potlatch Corporation (NASDAQ:PCH), and Hyster-Yale Materials Handling Inc (NYSE:HY) to get a better sense of its popularity.
Follow Chemours Co (NYSE:CC)
Follow Chemours Co (NYSE:CC)
Now, let’s review the recent action encompassing CC.
Hedge fund activity in Chemours Co (NYSE:CC)
Heading into Q4, a total of 24 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 140% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Thomas E. Claugus’s GMT Capital has the number one position in Chemours Co (NYSE:CC), worth close to $44.9 million, amounting to 1.1% of its total 13F portfolio. Coming in second is Trian Partners, with a $31.6 million position; 0.3% of its 13F portfolio is allocated to the stock. Other professional money managers that hold long positions consist of John Petry’s Sessa Capital, David Stemerman’s Conatus Capital Management and D E Shaw.
Now, key money managers were breaking ground themselves. GMT Capital, managed by Thomas E. Claugus, initiated the largest position in Chemours Co (NYSE:CC). GMT Capital had $44.9 million invested in the company at the end of the quarter. Nelson Peltz’s Trian Partners also made a $31.6 million investment in the stock during the quarter. The following funds were also among the new CC investors: John Petry’s Sessa Capital, David Stemerman’s Conatus Capital Management, and D E Shaw.
Let’s check out hedge fund activity in other stocks similar to Chemours Co (NYSE:CC). These stocks are Granite Construction Inc. (NYSE:GVA), Potlatch Corporation (NASDAQ:PCH), Hyster-Yale Materials Handling Inc (NYSE:HY), and Children’s Place Retail Stores, Inc. (NASDAQ:PLCE). This group of stocks’ market valuations match CC’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GVA | 17 | 58763 | 3 |
| PCH | 13 | 64274 | 3 |
| HY | 13 | 40645 | 0 |
| PLCE | 11 | 184701 | -8 |
As you can see these stocks had an average of 13.5 hedge funds with bullish positions and the average amount invested in these stocks was $87 million. That figure was $172 million in CC’s case. Granite Construction Inc. (NYSE:GVA) is the most popular stock in this table. On the other hand Children’s Place Retail Stores, Inc. (NASDAQ:PLCE) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Chemours Co (NYSE:CC) 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.
