The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge funds have been producing disappointing net returns in recent years, however that was partly due to the poor performance of small-cap stocks in general. Well, small-cap stocks finally turned the corner and have been beating the large-cap stocks by more than 10 percentage points over the last 5 months.This means the relevancy of hedge funds’ public filings became inarguable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM).
Is Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM) ready to rally soon? The smart money is in an optimistic mood. The number of long hedge fund bets increased by 9 recently. At the end of this article we will also compare TSEM to other stocks including McEwen Mining Inc (NYSE:MUX), Infoblox Inc (NYSE:BLOX), and Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) to get a better sense of its popularity.
Follow Tower Semiconductor Ltd (NASDAQ:TSEM)
Follow Tower Semiconductor Ltd (NASDAQ:TSEM)
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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With all of this in mind, let’s take a peek at the new action surrounding Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM).
What have hedge funds been doing with Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM)?
At the end of the third quarter, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a rise of 53% from the previous quarter. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Richard Mashaal’s Rima Senvest Management has the largest position in Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM), worth close to $114.6 million, amounting to 8.2% of its total 13F portfolio. The second most bullish fund manager is Michael M. Rothenberg of Moab Capital Partners, with a $24.1 million position; the fund has 7.8% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish consist of Israel Englander’s Millennium Management, Panayotis Takis Sparaggis’ Alkeon Capital Management and Paul Marshall and Ian Wace’s Marshall Wace LLP.
Now, some big names were breaking ground themselves. Laurion Capital Management, managed by Benjamin A. Smith, assembled the largest position in Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM). Laurion Capital Management had $7.4 million invested in the company at the end of the quarter. Millennium Management also initiated a $3.8 million position during the quarter. The other funds with brand new TSEM positions are D. E. Shaw’s D E Shaw, Simon Sadler’s Segantii Capital, and Ken Griffin’s Citadel Investment Group.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM) but similarly valued. These stocks are McEwen Mining Inc (NYSE:MUX), Infoblox Inc (NYSE:BLOX), Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN), and Multi-Color Corporation (NASDAQ:LABL). All of these stocks’ market caps are similar to TSEM’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MUX | 8 | 17065 | -2 |
| BLOX | 29 | 437605 | 4 |
| ACHN | 27 | 348980 | 5 |
| LABL | 7 | 45924 | 3 |
As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $212 million. That figure was $237 million in TSEM’s case. Infoblox Inc (NYSE:BLOX) is the most popular stock in this table. On the other hand Multi-Color Corporation (NASDAQ:LABL) is the least popular one with only 7 bullish hedge fund positions. Tower Semiconductor Ltd. (USA) (NASDAQ:TSEM) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard BLOX might be a better candidate to consider a long position.
Disclosure: None
