The worries about the economic slowdown in China and the ongoing uncertainty about the path of interest-rate increases triggered several waves of equity sell-offs during the third quarter. Of course, most hedge funds and other asset managers had to stomach substantial losses during the bloody three-month period, which might have caused some to consider fleeing the U.S. equity markets. Interestingly, smaller-cap stocks registered higher losses than large-capitalization stocks during the September quarter, suggesting that institutional investors heavily discarded seemingly riskier equities amid high uncertainty and turmoil. In fact, the Russell 2000 Index lost 11.9% in the third quarter, while the Standard and Poor’s 500 benchmark declined a mere 6.4%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Gibraltar Industries Inc (NASDAQ:ROCK).
Gibraltar Industries Inc was in 20 hedge funds’ portfolios at the end of the third quarter of 2015. ROCK investors should pay attention to an increase in support from the world’s most elite money managers recently. There were 13 hedge funds in our database with ROCK holdings at the end of the previous quarter. At the end of this article we will also compare ROCK to other stocks, including Unit Corporation (NYSE:UNT), Mirati Therapeutics, Inc. (NASDAQ:MRTX), and AppFolio Inc (NASDAQ:APPF) to get a better sense of its popularity.
Follow Gibraltar Industries Inc. (NASDAQ:ROCK)
Follow Gibraltar Industries Inc. (NASDAQ:ROCK)
According to most traders, hedge funds are perceived as slow, old financial vehicles of yesteryear. While there are more than 8000 funds in operation at the moment, Our experts hone in on the masters of this group, about 700 funds. These hedge fund managers preside over most of all hedge funds’ total capital, and by shadowing their inimitable investments, Insider Monkey has figured out several investment strategies that have historically defeated the market. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points annually for a decade in their back tests.
Keeping this in mind, we’re going to view the recent action regarding Gibraltar Industries Inc (NASDAQ:ROCK).
What does the smart money think about Gibraltar Industries Inc (NASDAQ:ROCK)?
At Q3’s end, a total of 20 of the hedge funds tracked by Insider Monkey were bullish on this stock, a surge of 54% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Pzena Investment Management, managed by Richard S. Pzena, holds the biggest position in Gibraltar Industries Inc (NASDAQ:ROCK). The fund reported a $38.6 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is Eric Edidin and Josh Lobel of Archer Capital Management, with a $33 million stake; 4.7% of its 13F portfolio is allocated to the company. Remaining members of the smart money with similar optimism consist of Chuck Royce’s Royce & Associates, Jim Simons’s Renaissance Technologies and Richard S. Meisenberg’s ACK Asset Management.
As industrywide interest jumped, key money managers were leading the bulls’ herd. ACK Asset Management, managed by Richard S. Meisenberg, established the most valuable position in Gibraltar Industries Inc (NASDAQ:ROCK). The fund had $7.8 million invested in the company at the end of the quarter. David Park’s Headlands Capital also initiated a $5.9 million position during the quarter. The following funds were also among the new ROCK investors: Ken Griffin’s Citadel Investment Group, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Ken Brodkowitz and Mike Vermut’s Newland Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Gibraltar Industries Inc (NASDAQ:ROCK) but similarly valued. We will take a look at Unit Corporation (NYSE:UNT), Mirati Therapeutics, Inc. (NASDAQ:MRTX), AppFolio Inc (NASDAQ:APPF), and Blucora Inc (NASDAQ:BCOR). This group of stocks’ market caps are closest to ROCK’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| UNT | 12 | 77131 | -2 |
| MRTX | 19 | 233452 | 8 |
| APPF | 5 | 13767 | -3 |
| BCOR | 16 | 68574 | -5 |
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 $98 million. That figure was $131 million in ROCK’s case, a positive sign. Mirati Therapeutics, Inc. (NASDAQ:MRTX) is the most popular stock in this table. On the other hand AppFolio Inc (NASDAQ:APPF) is the least popular one with only 5 bullish hedge fund positions. Gibraltar Industries Inc (NASDAQ:ROCK) is clearly outshines the stocks from this group. 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.
