Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the first quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of ReneSola Ltd. (NYSE:SOL) based on that data.
Is ReneSola Ltd. (NYSE:SOL) the right investment to pursue these days? The smart money is becoming more confident. The number of long hedge fund positions increased by 1 lately. Our calculations also showed that SOL isn’t among the 30 most popular stocks among hedge funds (click for Q1 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.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 44 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Matthew Hulsizer of PEAK6 Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. You can watch our latest hedge fund manager interview here and find out the name of the large-cap healthcare stock that Sio Capital’s Michael Castor expects to double. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s take a glance at the latest hedge fund action encompassing ReneSola Ltd. (NYSE:SOL).
How are hedge funds trading ReneSola Ltd. (NYSE:SOL)?
At the end of the first quarter, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 50% from one quarter earlier. On the other hand, there were a total of 3 hedge funds with a bullish position in SOL a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Himanshu H. Shah’s Shah Capital Management has the largest position in ReneSola Ltd. (NYSE:SOL), worth close to $16.3 million, comprising 12.9% of its total 13F portfolio. On Shah Capital Management’s heels is Renaissance Technologies, which holds a $0.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers that hold long positions comprise Matthew Hulsizer’s PEAK6 Capital Management, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors and . In terms of the portfolio weights assigned to each position Shah Capital Management allocated the biggest weight to ReneSola Ltd. (NYSE:SOL), around 12.89% of its 13F portfolio. Schonfeld Strategic Advisors is also relatively very bullish on the stock, dishing out 0.0011 percent of its 13F equity portfolio to SOL.
As industrywide interest jumped, key money managers were leading the bulls’ herd. Schonfeld Strategic Advisors, managed by Ryan Tolkin (CIO), established the largest position in ReneSola Ltd. (NYSE:SOL). Schonfeld Strategic Advisors had $0 million invested in the company at the end of the quarter.
Let’s now review hedge fund activity in other stocks similar to ReneSola Ltd. (NYSE:SOL). We will take a look at Big Rock Partners Acquisition Corp. (NASDAQ:BRPA), Kingstone Companies Inc (NASDAQ:KINS), Cumberland Pharmaceuticals, Inc. (NASDAQ:CPIX), and Trevena Inc (NASDAQ:TRVN). This group of stocks’ market values are similar to SOL’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BRPA | 6 | 2055 | -2 |
| KINS | 4 | 4606 | -1 |
| CPIX | 3 | 8943 | 0 |
| TRVN | 4 | 1874 | -1 |
| Average | 4.25 | 4370 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 4.25 hedge funds with bullish positions and the average amount invested in these stocks was $4 million. That figure was $17 million in SOL’s case. Big Rock Partners Acquisition Corp. (NASDAQ:BRPA) is the most popular stock in this table. On the other hand Cumberland Pharmaceuticals, Inc. (NASDAQ:CPIX) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks ReneSola Ltd. (NYSE:SOL) is even less popular than CPIX. Hedge funds dodged a bullet by taking a bearish stance towards SOL. Our calculations showed that the top 10 most popular hedge fund stocks returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 7.9% in 2020 through May 22nd but managed to beat the market by 15.6 percentage points. Unfortunately SOL wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); SOL investors were disappointed as the stock returned -18.1% during the second quarter (through May 22nd) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.
Disclosure: None. This article was originally published at Insider Monkey.
