The 700+ hedge funds and money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund positions. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Penumbra Inc (NYSE:PEN) .
Is Penumbra Inc (NYSE:PEN) the right investment to pursue these days? Prominent investors are buying. The number of bullish hedge fund investments went up by 4 lately. There were 13 hedge funds in our database with PEN holdings at the end of the previous quarter. 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 Office Depot Inc (NYSE:ODP), Esterline Technologies Corporation (NYSE:ESL), and Mueller Industries, Inc. (NYSE:MLI) to gather more data points.
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Now, we’re going to take a look at the new action encompassing Penumbra Inc (NYSE:PEN).
Hedge fund activity in Penumbra Inc (NYSE:PEN)
Heading into the fourth quarter of 2016, a total of 17 of the hedge funds tracked by Insider Monkey were long this stock, a change of 31% from the second quarter of 2016. The graph below displays the number of hedge funds with bullish position in PEN over the last 5 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Jeremy Green’s Redmile Group has the largest position in Penumbra Inc (NYSE:PEN), worth close to $51.1 million, corresponding to 4.1% of its total 13F portfolio. The second largest stake is held by Kris Jenner, Gordon Bussard, Graham McPhail of Rock Springs Capital Management, with a $20.3 million position; 1.3% of its 13F portfolio is allocated to the stock. Other professional money managers that are bullish consist of Christopher James’s Partner Fund Management, Jim Simons’s Renaissance Technologies and Israel Englander’s Millennium Management. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
As aggregate interest increased, some big names were leading the bulls’ herd. Millennium Management, led by Israel Englander, established the most outsized position in Penumbra Inc (NYSE:PEN). Millennium Management had $14 million invested in the company at the end of the quarter. Columbus Circle Investors also made a $12.6 million investment in the stock during the quarter. The other funds with brand new PEN positions are James Dondero’s Highland Capital Management, Dmitry Balyasny’s Balyasny Asset Management, and Efrem Kamen’s Pura Vida Investments.
Let’s now take a look at hedge fund activity in other stocks similar to Penumbra Inc (NYSE:PEN). We will take a look at Office Depot Inc (NYSE:ODP), Esterline Technologies Corporation (NYSE:ESL), Mueller Industries, Inc. (NYSE:MLI), and Lithia Motors Inc (NYSE:LAD). All of these stocks’ market caps are closest to PEN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ODP | 34 | 284342 | -13 |
| ESL | 18 | 377920 | 8 |
| MLI | 15 | 249669 | -1 |
| LAD | 20 | 328738 | -6 |
As you can see these stocks had an average of 21.75 hedge funds with bullish positions and the average amount invested in these stocks was $310 million. That figure was $158 million in PEN’s case. Office Depot Inc (NYSE:ODP) is the most popular stock in this table. On the other hand Mueller Industries, Inc. (NYSE:MLI) is the least popular one with only 15 bullish hedge fund positions. Penumbra Inc (NYSE:PEN) 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 ODP might be a better candidate to consider taking a long position in.
