Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Micron and Anadarko Petroleum, have not done well during the last 12 months ending in October due to various reasons. Nevertheless, the data show elite investors’ consensus picks have done well on average. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last four quarters ending in October and sixty three percent of these 30 stocks outperformed the market. S&P 500 Index returned only 5.2% during the same period and less than 49% of its constituents managed to beat this return. Because their consensus picks have done well, we pay attention to what elite funds think before doing extensive research on a stock. In this article, we take a closer look at Heritage Insurance Holdings Inc (NYSE:HRTG) from the perspective of those elite funds.
Heritage Insurance Holdings Inc (NYSE:HRTG) has seen an increase in hedge fund interest of late. Heritage Insurance Holdings Inc (NYSE:HRTG) was in 13 hedge funds’ portfolios at the end of September. There were 12 hedge funds in our database with Heritage Insurance Holdings Inc (NYSE:HRTG) positions at the end of the previous quarter. At the end of this article, we will also compare Heritage Insurance Holdings Inc (NYSE:HRTG) to other stocks including Gran Tierra Energy Inc. (NYSEAMEX:GTE), Capital Senior Living Corporation (NYSE:CSU), and ePlus Inc. (NASDAQ:PLUS) to get a better sense of its popularity.
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Keeping this in mind, we’re going to take a gander at the latest action encompassing Heritage Insurance Holdings Inc (NYSE:HRTG).
How are hedge funds trading Heritage Insurance Holdings Inc (NYSE:HRTG)?
At the end of the third quarter, a total of 13 of the hedge funds tracked by Insider Monkey were long in this stock, an increase of 8% from the second quarter. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the biggest position in Heritage Insurance Holdings Inc (NYSE:HRTG). Citadel Investment Group has a $22.5 million position in the stock, comprising less than 0.1% of its 13F portfolio. The second most bullish hedge fund manager is Anand Parekh of Alyeska Investment Group, with a $21.7 million position; 0.3% of its 13F portfolio is allocated to the company. Remaining peers with similar optimism contain Brian Ashford-Russell and Tim Woolley’s Polar Capital, Robert B. Gillam’s McKinley Capital Management and Dmitry Balyasny’s Balyasny Asset Management.
With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. AQR Capital Management, managed by Cliff Asness, created the most outsized position in Heritage Insurance Holdings Inc (NYSE:HRTG). AQR Capital Management had $5.2 million invested in the company at the end of the quarter. Gregg Moskowitz’s Interval Partners also made a $1.1 million investment in the stock during the quarter. The only other fund with a new position in the stock is David Costen Haley’s HBK Investments.
Let’s also examine hedge fund activity in other stocks similar to Heritage Insurance Holdings Inc (NYSE:HRTG). We will take a look at Gran Tierra Energy Inc. (NYSEAMEX:GTE), Capital Senior Living Corporation (NYSE:CSU), ePlus Inc. (NASDAQ:PLUS), and 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS). This group of stocks’ market valuations match Heritage Insurance Holdings Inc (NYSE:HRTG)’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GTE | 16 | 120028 | -1 |
| CSU | 19 | 145213 | 0 |
| PLUS | 12 | 31278 | -2 |
| FLWS | 11 | 32963 | -9 |
As you can see these stocks had an average of 15 hedge funds with bullish positions and the average amount invested in these stocks was $82 million. That figure was $85 million in HRTG’s case. Capital Senior Living Corporation (NYSE:CSU) is the most popular stock in this table. On the other hand, 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS) is the least popular one with only 11 bullish hedge fund positions. Heritage Insurance Holdings Inc (NYSE:HRTG) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are more interested in despite the total number of funds long HRTG increasing by one. In this regard Capital Senior Living Corporation (NYSE:CSU) might be a better candidate to consider a long position.