After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of December 31. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Valmont Industries, Inc. (NYSE:VMI).
Valmont Industries, Inc. (NYSE:VMI) was in 18 hedge funds’ portfolios at the end of the fourth quarter of 2018. VMI investors should pay attention to an increase in hedge fund interest lately. There were 17 hedge funds in our database with VMI holdings at the end of the previous quarter. Our calculations also showed that VMI isn’t among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to view the recent hedge fund action surrounding Valmont Industries, Inc. (NYSE:VMI).
How are hedge funds trading Valmont Industries, Inc. (NYSE:VMI)?
At the end of the fourth quarter, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards VMI over the last 14 quarters. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
Among these funds, Impax Asset Management held the most valuable stake in Valmont Industries, Inc. (NYSE:VMI), which was worth $74.2 million at the end of the third quarter. On the second spot was Royce & Associates which amassed $67.7 million worth of shares. Moreover, Nitorum Capital, Millennium Management, and Citadel Investment Group were also bullish on Valmont Industries, Inc. (NYSE:VMI), allocating a large percentage of their portfolios to this stock.
As one would reasonably expect, some big names have been driving this bullishness. Weld Capital Management, managed by Minhua Zhang, initiated the most outsized position in Valmont Industries, Inc. (NYSE:VMI). Weld Capital Management had $0.8 million invested in the company at the end of the quarter. Ray Dalio’s Bridgewater Associates also initiated a $0.5 million position during the quarter. The following funds were also among the new VMI investors: Michael Platt and William Reeves’s BlueCrest Capital Mgmt. and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Valmont Industries, Inc. (NYSE:VMI) but similarly valued. These stocks are CNO Financial Group Inc (NYSE:CNO), Colfax Corporation (NYSE:CFX), Omnicell, Inc. (NASDAQ:OMCL), and Box, Inc. (NYSE:BOX). All of these stocks’ market caps resemble VMI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CNO | 11 | 104672 | -3 |
| CFX | 27 | 333618 | 7 |
| OMCL | 13 | 64252 | 8 |
| BOX | 24 | 386086 | -2 |
| Average | 18.75 | 222157 | 2.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.75 hedge funds with bullish positions and the average amount invested in these stocks was $222 million. That figure was $203 million in VMI’s case. Colfax Corporation (NYSE:CFX) is the most popular stock in this table. On the other hand CNO Financial Group Inc (NYSE:CNO) is the least popular one with only 11 bullish hedge fund positions. Valmont Industries, Inc. (NYSE:VMI) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. A small number of hedge funds were also right about betting on VMI, though not to the same extent, as the stock returned 19.8% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
