Concerns over a shift in Fed’s easy monetary policy have hit several hedge funds hard during the third quarter. A number of sectors are in correction territory. More importantly, Russell 2000 ETF (IWM) underperformed the larger S&P 500 ETF (SPY) by more than 14 percentage points between June 25, 2015 and October 30, 2015. Hedge funds and institutional investors tracked by Insider Monkey usually invest a disproportionate amount of their portfolios in smaller cap stocks. We have been receiving indications that hedge funds were paring back their overall exposure and this is one of the factors behind the recent movements in major indices. In this article, we will take a closer look at hedge fund sentiment towards Cypress Semiconductor Corporation (NASDAQ:CY).
Cypress Semiconductor Corporation (NASDAQ:CY) was in 32 hedge funds’ portfolios at the end of the third quarter of 2015. CY has experienced a decrease in enthusiasm from smart money recently. There were 35 hedge funds in our database with CY holdings at the end of the previous 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 Outfront Media Inc (NYSE:OUT), Oshkosh Corporation (NYSE:OSK), and UIL Holdings Corporation (NYSE:UIL) to gather more data points.
Follow Cypress Semiconductor Corp (NASDAQ:CY)
Follow Cypress Semiconductor Corp (NASDAQ:CY)
At the moment there are numerous signals investors put to use to size up stocks. A pair of the most under-the-radar signals are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the best picks of the top investment managers can trounce their index-focused peers by a very impressive amount (see the details here).
With all of this in mind, we’re going to analyze the recent action regarding Cypress Semiconductor Corporation (NASDAQ:CY).
Hedge fund activity in Cypress Semiconductor Corporation (NASDAQ:CY)
At the end of the third quarter, a total of 32 of the hedge funds tracked by Insider Monkey were long this stock, a decrease of 9% from one quarter earlier. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Three Bays Capital, managed by Matthew Sidman, holds the most valuable position in Cypress Semiconductor Corporation (NASDAQ:CY). In its latest 13F filing, the fund has reported a $184.9 million position in the stock, comprising 9.3% of its 13F portfolio. Sitting at the No. 2 spot is George Soros’ Soros Fund Management, holding a $168.8 million position; 2.6% of its 13F portfolio is allocated to the stock. Remaining members of the smart money that are bullish include Bain Capital’s Brookside Capital, Israel Englander’s Millennium Management and Ken Griffin’s Citadel Investment Group.
Judging by the fact that Cypress Semiconductor Corporation (NASDAQ:CY) has faced falling interest from the entirety of the hedge funds we track, it’s easy to see that there exists a select few hedgies that slashed their positions entirely in the third quarter. Interestingly, Leon Shaulov’s Maplelane Capital dropped the largest position of all the hedgies followed by Insider Monkey, comprising about $26.5 million in stock. Alec Litowitz and Ross Laser’s fund, Magnetar Capital, also said goodbye to its holding, about $20.1 million worth of CY shares. These transactions are important to note, as total hedge fund interest dropped by 3 funds in the third quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Cypress Semiconductor Corporation (NASDAQ:CY) but similarly valued. These stocks are Outfront Media Inc (NYSE:OUT), Oshkosh Corporation (NYSE:OSK), UIL Holdings Corporation (NYSE:UIL), and CAE, Inc. (USA) (NYSE:CAE). This group of stocks’ market valuations are closest to CY’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| OUT | 13 | 139666 | -6 |
| OSK | 21 | 173010 | 5 |
| UIL | 10 | 371942 | -3 |
| CAE | 6 | 21991 | 0 |
As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $177 million. That figure was an impressive $650 million in CY’s case. Oshkosh Corporation (NYSE:OSK) is the most popular stock in this table. On the other hand CAE, Inc. (USA) (NYSE:CAE) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks Cypress Semiconductor Corporation (NASDAQ:CY) is more popular among hedge funds and has also attracted a larger amount of hedge funds’ capital. 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.
