The SEC requires hedge funds and wealthy investors with over a certain portfolio size to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings level the playing field for ordinary investors. The latest round of 13F filings discloses the funds’ positions on September 30. We at Insider Monkey have compiled an extensive database of more than 700 of those elite funds and prominent investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Lennar Corporation (NYSE:LEN) based on those filings.
Lennar Corporation (NYSE:LEN) has seen an increase in support from the world’s most elite money managers of late. LEN was in 48 hedge funds’ portfolios at the end of September. There were 40 hedge funds in our database with LEN 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 Best Buy Co., Inc. (NYSE:BBY), UDR, Inc. (NYSE:UDR), and Textron Inc. (NYSE:TXT) to gather more data points.
Follow Lennar Corp W (NYSE:LEN, LEN.B)
Follow Lennar Corp W (NYSE:LEN, LEN.B)
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 glance at the new action encompassing Lennar Corporation (NYSE:LEN).
What does the smart money think about Lennar Corporation (NYSE:LEN)?
At Q3’s end, a total of 48 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 20% from the second quarter of 2016. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Greenhaven Associates, managed by Edgar Wachenheim, holds the largest position in Lennar Corporation (NYSE:LEN). Greenhaven Associates has a $214.2 million position in the stock, comprising 4.1% of its 13F portfolio. On Greenhaven Associates’s heels is Eminence Capital, managed by Ricky Sandler, which holds a $152.4 million position; the fund has 2.5% of its 13F portfolio invested in the stock. Remaining professional money managers that are bullish consist of John Khoury’s Long Pond Capital, Ken Heebner’s Capital Growth Management and Ross Margolies’ Stelliam Investment Management.
As aggregate interest increased, specific money managers were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, assembled the biggest position in Lennar Corporation (NYSE:LEN). Point72 Asset Management had $26.6 million invested in the company at the end of the quarter. Mark Kingdon’s Kingdon Capital also initiated a $22 million position during the quarter. The following funds were also among the new LEN investors: Clint Murray’s Lodge Hill Capital, Cliff Asness’ AQR Capital Management, and Ken Griffin’s Citadel Investment Group.
Let’s go over hedge fund activity in other stocks similar to Lennar Corporation (NYSE:LEN). These stocks are Best Buy Co., Inc. (NYSE:BBY), UDR, Inc. (NYSE:UDR), Textron Inc. (NYSE:TXT), and Akamai Technologies, Inc. (NASDAQ:AKAM). This group of stocks’ market valuations match LEN’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BBY | 40 | 792943 | 11 |
| UDR | 14 | 151008 | 1 |
| TXT | 17 | 387650 | -10 |
| AKAM | 36 | 707311 | 6 |
As you can see these stocks had an average of 26.75 hedge funds with bullish positions and the average amount invested in these stocks was $510 million. That figure was $1.13 billion in LEN’s case. Best Buy Co., Inc. (NYSE:BBY) is the most popular stock in this table. On the other hand UDR, Inc. (NYSE:UDR) is the least popular one with only 14 bullish hedge fund positions. Compared to these stocks Lennar Corporation (NYSE:LEN) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
