Most investors tend to think that hedge funds and other asset managers are worthless, as they cannot beat even simple index fund portfolios. In fact, most people expect hedge funds to compete with and outperform the bull market that we have witnessed in recent years. However, hedge funds are generally partially hedged and aim at delivering attractive risk-adjusted returns rather than following the ups and downs of equity markets hoping that they will outperform the broader market. Our research shows that certain hedge funds do have great stock picking skills (and we can identify these hedge funds in advance pretty accurately), so let’s take a glance at the smart money sentiment towards Juniper Industrial Holdings, Inc. (NYSE:JIH).
Is JIH a good stock to buy now? Juniper Industrial Holdings, Inc. (NYSE:JIH) investors should pay attention to an increase in support from the world’s most elite money managers in recent months. Juniper Industrial Holdings, Inc. (NYSE:JIH) was in 22 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 18. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that JIH isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
Today there are several metrics stock traders have at their disposal to analyze their holdings. A pair of the best metrics are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the top picks of the top fund managers can beat the market by a significant amount (see the details here).
Michael Platt of BlueCrest Capital Mgmt.
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now we’re going to review the recent hedge fund action surrounding Juniper Industrial Holdings, Inc. (NYSE:JIH).
Do Hedge Funds Think JIH Is A Good Stock To Buy Now?
At Q3’s end, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 22% from one quarter earlier. On the other hand, there were a total of 0 hedge funds with a bullish position in JIH a year ago. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Glazer Capital, managed by Paul Glazer, holds the biggest position in Juniper Industrial Holdings, Inc. (NYSE:JIH). Glazer Capital has a $19.5 million position in the stock, comprising 1% of its 13F portfolio. On Glazer Capital’s heels is Magnetar Capital, led by Alec Litowitz and Ross Laser, holding a $19.4 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other members of the smart money that are bullish encompass Michael Platt and William Reeves’s BlueCrest Capital Mgmt., Anand Parekh’s Alyeska Investment Group and Paul Marshall and Ian Wace’s Marshall Wace LLP. In terms of the portfolio weights assigned to each position Beryl Capital Management allocated the biggest weight to Juniper Industrial Holdings, Inc. (NYSE:JIH), around 1.31% of its 13F portfolio. Glazer Capital is also relatively very bullish on the stock, dishing out 0.95 percent of its 13F equity portfolio to JIH.
As industrywide interest jumped, key hedge funds were leading the bulls’ herd. Beryl Capital Management, managed by David Alexander Witkin, established the most valuable position in Juniper Industrial Holdings, Inc. (NYSE:JIH). Beryl Capital Management had $7.3 million invested in the company at the end of the quarter. Carl Tiedemann and Michael Tiedemann’s TIG Advisors also made a $4.3 million investment in the stock during the quarter. The following funds were also among the new JIH investors: Robert Henry Lynch’s Aristeia Capital, Nehal Chopra’s Ratan Capital Group, and Karim Abbadi and Edward McBride’s Centiva Capital.
Let’s go over hedge fund activity in other stocks similar to Juniper Industrial Holdings, Inc. (NYSE:JIH). These stocks are Cowen Inc. (NASDAQ:COWN), The First Bancshares, Inc. (NASDAQ:FBMS), Antares Pharma Inc (NASDAQ:ATRS), Geopark Ltd (NYSE:GPRK), Global Partners LP (NYSE:GLP), Despegar.com, Corp. (NYSE:DESP), and Cue Biopharma, Inc. (NASDAQ:CUE). This group of stocks’ market values match JIH’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| COWN | 21 | 105496 | 3 |
| FBMS | 7 | 19827 | -1 |
| ATRS | 18 | 18458 | -2 |
| GPRK | 12 | 52867 | -1 |
| GLP | 2 | 5605 | 0 |
| DESP | 17 | 98334 | -1 |
| CUE | 15 | 155293 | -3 |
| Average | 13.1 | 65126 | -0.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.1 hedge funds with bullish positions and the average amount invested in these stocks was $65 million. That figure was $150 million in JIH’s case. Cowen Inc. (NASDAQ:COWN) is the most popular stock in this table. On the other hand Global Partners LP (NYSE:GLP) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Juniper Industrial Holdings, Inc. (NYSE:JIH) is more popular among hedge funds. Our overall hedge fund sentiment score for JIH is 89. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. Unfortunately JIH wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on JIH were disappointed as the stock returned -0.6% since the end of the third quarter (through 12/14) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Follow Juniper Industrial Holdings Inc. (NYSE:JIH)
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Disclosure: None. This article was originally published at Insider Monkey.
