While the market driven by short-term sentiment influenced by uncertainty regarding the future of the interest rate environment in the US, declining oil prices and the trade war with China, many smart money investors kept their optimism regarding the current bull run in the fourth quarter, while still hedging many of their long positions. However, as we know, big investors usually buy stocks with strong fundamentals, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding Teleflex Incorporated (NYSE:TFX).
Teleflex Incorporated (NYSE:TFX) was in 15 hedge funds’ portfolios at the end of December. TFX has seen a decrease in activity from the world’s largest hedge funds of late. There were 17 hedge funds in our database with TFX holdings at the end of the previous quarter. Our calculations also showed that TFX isn’t among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of metrics shareholders have at their disposal to assess publicly traded companies. A couple of the most useful metrics are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the elite fund managers can trounce the S&P 500 by a very impressive margin (see the details here).
Let’s take a gander at the latest hedge fund action regarding Teleflex Incorporated (NYSE:TFX).
Hedge fund activity in Teleflex Incorporated (NYSE:TFX)
Heading into the first quarter of 2019, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of -12% from the second quarter of 2018. By comparison, 23 hedge funds held shares or bullish call options in TFX a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
Among these funds, Select Equity Group held the most valuable stake in Teleflex Incorporated (NYSE:TFX), which was worth $291.2 million at the end of the third quarter. On the second spot was Marshall Wace LLP which amassed $151 million worth of shares. Moreover, Point72 Asset Management, Rock Springs Capital Management, and Renaissance Technologies were also bullish on Teleflex Incorporated (NYSE:TFX), allocating a large percentage of their portfolios to this stock.
Because Teleflex Incorporated (NYSE:TFX) has experienced bearish sentiment from the smart money, we can see that there was a specific group of money managers that elected to cut their entire stakes last quarter. Interestingly, Anand Parekh’s Alyeska Investment Group dumped the biggest stake of the 700 funds followed by Insider Monkey, valued at about $46.3 million in stock, and Samuel Isaly’s OrbiMed Advisors was right behind this move, as the fund cut about $41.9 million worth. These transactions are interesting, as total hedge fund interest was cut by 2 funds last quarter.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Teleflex Incorporated (NYSE:TFX) but similarly valued. These stocks are Rollins, Inc. (NYSE:ROL), Altice USA, Inc. (NYSE:ATUS), WellCare Health Plans, Inc. (NYSE:WCG), and Vornado Realty Trust (NYSE:VNO). All of these stocks’ market caps are closest to TFX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ROL | 22 | 269805 | 5 |
| ATUS | 51 | 1375717 | 4 |
| WCG | 39 | 955525 | 4 |
| VNO | 23 | 336593 | -2 |
| Average | 33.75 | 734410 | 2.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.75 hedge funds with bullish positions and the average amount invested in these stocks was $734 million. That figure was $597 million in TFX’s case. Altice USA, Inc. (NYSE:ATUS) is the most popular stock in this table. On the other hand Rollins, Inc. (NYSE:ROL) is the least popular one with only 22 bullish hedge fund positions. Compared to these stocks Teleflex Incorporated (NYSE:TFX) is even less popular than ROL. Our calculations showed that top 15 most popular stocks among hedge funds returned 19.7% through March 15th and outperformed the S&P 500 ETF (SPY) by 6.6 percentage points. A few hedge funds were also right about betting on TFX, though not to the same extent, as the stock returned 17.3% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
