It seems that the masses and most of the financial media hate hedge funds and what they do, but why is this hatred of hedge funds so prominent? At the end of the day, these asset management firms do not gamble the hard-earned money of the people who are on the edge of poverty. Truth be told, most hedge fund managers and other smaller players within this industry are very smart and skilled investors. Of course, they may also make wrong bets in some instances, but no one knows what the future holds and how market participants will react to the bountiful news that floods in each day. The S&P 500 Index gained 5.2% in the 12 month-period that ended October 30, while less than 49% of its stocks beat the benchmark. In contrast, the 30 most popular S&P 500 stocks among the hedge fund investors tracked by the Insider Monkey team returned 9.5% over the same period, which provides evidence that these money managers do have great stock picking abilities. Even more to that, 63% of these stocks managed to beat the S&P 500 Index. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Huntsman Corporation (NYSE:HUN).
Huntsman Corporation investors should be aware of an increase in hedge fund sentiment lately. 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 Nu Skin Enterprises, Inc. (NYSE:NUS), Big Lots, Inc. (NYSE:BIG), and CLARCOR Inc. (NYSE:CLC) to gather more data points.
Follow Huntsman Corp (NYSE:HUN)
Follow Huntsman Corp (NYSE:HUN)
Keeping this in mind, let’s go over the recent action surrounding Huntsman Corporation (NYSE:HUN).
How have hedgies been trading Huntsman Corporation (NYSE:HUN)?
Heading into Q4, a total of 45 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 18% from the second quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Scopia Capital, managed by Matt Sirovich and Jeremy Mindich, holds the number one position in Huntsman Corporation (NYSE:HUN). Scopia Capital has a $134.4 million position in the stock, comprising 2.9% of its 13F portfolio. The second most bullish fund manager is Appaloosa Management LP, managed by David Tepper, which holds a $77.9 million position; 2.7% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors with similar optimism contain Frank Brosens’s Taconic Capital, Steven Tananbaum’s GoldenTree Asset Management and Ken Griffin’s Citadel Investment Group.
Consequently, some big names have jumped into Huntsman Corporation (NYSE:HUN) headfirst. Renaissance Technologies, managed by Jim Simons, established the biggest position in Huntsman Corporation (NYSE:HUN). Renaissance Technologies had $12.5 million invested in the company at the end of the quarter. Howard Guberman’s Gruss Asset Management also initiated a $9.7 million position during the quarter. The other funds with brand new HUN positions are Don Morgan’s Brigade Capital, David Costen Haley’s HBK Investments, and Malcolm Fairbairn’s Ascend Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Huntsman Corporation (NYSE:HUN) but similarly valued. We will take a look at Nu Skin Enterprises, Inc. (NYSE:NUS), Big Lots, Inc. (NYSE:BIG), CLARCOR Inc. (NYSE:CLC), and Prestige Brands Holdings, Inc. (NYSE:PBH). All of these stocks’ market caps match HUN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NUS | 29 | 175945 | 6 |
| BIG | 18 | 254501 | -6 |
| CLC | 15 | 150331 | 3 |
| PBH | 12 | 176260 | -1 |
As you can see these stocks had an average of 18.5 hedge funds with bullish positions and the average amount invested in these stocks was $189 million. That figure was $465 million in HUN’s case. Nu Skin Enterprises, Inc. (NYSE:NUS) is the most popular stock in this table. On the other hand Prestige Brands Holdings, Inc. (NYSE:PBH) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Huntsman Corporation (NYSE:HUN) 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.
