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.
Dean Foods Co (NYSE:DF) has experienced a slight decrease in activity from the world’s largest hedge funds recently. DF was in 22 hedge funds’ portfolios at the end of September. There were 23 hedge funds in our database with DF 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 Eros International plc (NYSE:EROS), Press Ganey Holdings Inc (NYSE:PGND), and Nelnet, Inc. (NYSE:NNI) to gather more data points.
Follow Dean Foods Co (NYSE:DF)
Follow Dean Foods Co (NYSE:DF)
At the moment there are tons of formulas stock market investors put to use to grade their holdings. Some of the most underrated formulas are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the best picks of the top money managers can outperform the market by a very impressive amount (see the details here).
Now, we’re going to view the new action encompassing Dean Foods Co (NYSE:DF).
What have hedge funds been doing with Dean Foods Co (NYSE:DF)?
Heading into Q4, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of -4% from the second quarter. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Joel Greenblatt’s Gotham Asset Management has the biggest position in Dean Foods Co (NYSE:DF), worth close to $54.8 million, accounting for 0.5% of its total 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, which holds a $23.8 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish include Cliff Asness’ AQR Capital Management, Israel Englander’s Millennium Management and Glenn Russell Dubin’s Highbridge Capital Management.
Because Dean Foods Co (NYSE:DF) has faced a declination in interest from the smart money, it’s easy to see that there exists a select few hedgies who sold off their positions entirely in the third quarter. It’s worth mentioning that Ron Gutfleish’s Elm Ridge Capital dropped the largest investment of the “upper crust” of funds watched by Insider Monkey, totaling about $22.4 million in stock, and D. E. Shaw’s D E Shaw was right behind this move, as the fund said goodbye to about $16.4 million worth. These transactions are interesting, as total hedge fund interest was cut by 1 funds in the third quarter.
Let’s also examine hedge fund activity in other stocks similar to Dean Foods Co (NYSE:DF). These stocks are Eros International plc (NYSE:EROS), Press Ganey Holdings Inc (NYSE:PGND), Nelnet, Inc. (NYSE:NNI), and Allegheny Technologies Incorporated (NYSE:ATI). This group of stocks’ market caps are closest to DF’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| EROS | 16 | 130263 | 2 |
| PGND | 13 | 36372 | -1 |
| NNI | 21 | 117381 | 3 |
| ATI | 15 | 191395 | -2 |
As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $119 million. That figure was $164 million in DF’s case. Nelnet, Inc. (NYSE:NNI) is the most popular stock in this table with 21 funds reporting positions. On the other hand Press Ganey Holdings Inc (NYSE:PGND) is the least popular one. Compared to these stocks, Dean Foods Co (NYSE:DF) 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.
