Investing in hedge funds can bring large profits, but it’s not for everybody, since hedge funds are available only for high-net-worth individuals. They generate significant returns for investors to justify their large fees and they allocate a lot of time and employ a complex analysis to determine the best stocks to invest in. A particularly interesting group of stocks that hedge funds like is the small-caps. The huge amount of capital does not allow hedge funds to invest a lot in small-caps, but our research showed that their most popular small-cap ideas are less efficiently priced and generate stronger returns than their large- and mega-cap picks and the broader market. That is why we follow the hedge fund activity in the small-cap space.
Matson Inc (NYSE:MATX) investors should pay attention to a decrease in enthusiasm from smart money recently. At the end of this article we will also compare MATX to other stocks including Alexander & Baldwin Inc (NYSE:ALEX), Capitol Federal Financial, Inc. (NASDAQ:CFFN), and Scorpio Tankers Inc. (NYSE:STNG) to get a better sense of its popularity.
Follow Alexander & Baldwin Holdings Inc. (NYSE:MATX)
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Keeping this in mind, we’re going to take a gander at the new action surrounding Matson Inc (NYSE:MATX).
How have hedgies been trading Matson Inc (NYSE:MATX)?
Heading into Q4, a total of 16 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -6% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Renaissance Technologies, managed by Jim Simons, holds the biggest position in Matson Inc (NYSE:MATX). Renaissance Technologies has a $12.5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is Joel Greenblatt of Gotham Asset Management, with a $8.7 million position; 0.1% of its 13F portfolio is allocated to the stock. Some other peers with similar optimism consist of Bill Miller’s Legg Mason Capital Management, D. E. Shaw’s D E Shaw and Israel Englander’s Millennium Management.
Judging by the fact that Matson Inc (NYSE:MATX) has experienced a declination in interest from the aggregate hedge fund industry, it’s easy to see that there exists a select few funds who sold off their entire stakes by the end of the third quarter. At the top of the heap, Peter Muller’s PDT Partners cut the largest position of the 700 funds tracked by Insider Monkey, worth an estimated $2.5 million in stock, and Neil Chriss’s Hutchin Hill Capital was right behind this move, as the fund said goodbye to about $1.6 million worth.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Matson Inc (NYSE:MATX) but similarly valued. These stocks are Alexander & Baldwin Inc (NYSE:ALEX), Capitol Federal Financial, Inc. (NASDAQ:CFFN), Scorpio Tankers Inc. (NYSE:STNG), and InterOil Corporation (USA) (NYSE:IOC). This group of stocks’ market caps are closest to MATX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ALEX | 12 | 152236 | -7 |
| CFFN | 11 | 112579 | -3 |
| STNG | 30 | 410280 | 0 |
| IOC | 16 | 272993 | -1 |
As you can see these stocks had an average of 17.25 hedge funds with bullish positions and the average amount invested in these stocks was $237 million. That figure was $47 million in MATX’s case. Scorpio Tankers Inc. (NYSE:STNG) is the most popular stock in this table. On the other hand Capitol Federal Financial, Inc. (NASDAQ:CFFN) is the least popular one with only 11 bullish hedge fund positions. Matson Inc (NYSE:MATX) 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 piling on. In this regard STNG might be a better candidate to consider a long position.
