Should I Buy Great Panther Mining Ltd (GPL)?

The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on September 30th, about a month before the elections. We at Insider Monkey have made an extensive database of more than 817 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Great Panther Mining Ltd (NYSE:GPL) based on those filings.

Great Panther Mining Ltd (NYSE:GPL) investors should pay attention to an increase in enthusiasm from smart money of late. Great Panther Mining Ltd (NYSE:GPL) was in 5 hedge funds’ portfolios at the end of September. The all time high for this statistics is 8. Our calculations also showed that GPL isn’t among the 30 most popular stocks among hedge funds (click for Q3 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.

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 monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

Ken Griffin of Citadel Investment Group

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind we’re going to check out the fresh hedge fund action regarding Great Panther Mining Ltd (NYSE:GPL).

How have hedgies been trading Great Panther Mining Ltd (NYSE:GPL)?

At the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25% from the previous quarter. On the other hand, there were a total of 5 hedge funds with a bullish position in GPL 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, Renaissance Technologies has the biggest position in Great Panther Mining Ltd (NYSE:GPL), worth close to $3.6 million, comprising less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is John Overdeck and David Siegel of Two Sigma Advisors, with a $0.9 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish encompass Ken Griffin’s Citadel Investment Group, Eric Sprott’s Sprott Asset Management and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Sprott Asset Management allocated the biggest weight to Great Panther Mining Ltd (NYSE:GPL), around 0.01% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, designating 0.0036 percent of its 13F equity portfolio to GPL.

Now, key money managers have jumped into Great Panther Mining Ltd (NYSE:GPL) headfirst. Sprott Asset Management, managed by Eric Sprott, established the most valuable position in Great Panther Mining Ltd (NYSE:GPL). Sprott Asset Management had $0.2 million invested in the company at the end of the quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Great Panther Mining Ltd (NYSE:GPL) but similarly valued. These stocks are The Container Store Group Inc (NYSE:TCS), Source Capital, Inc. (NYSE:SOR), Akoustis Technologies, Inc. (NASDAQ:AKTS), Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), UFP Technologies, Inc. (NASDAQ:UFPT), Bar Harbor Bankshares (NYSE:BHB), and Business First Bancshares, Inc. (NASDAQ:BFST). This group of stocks’ market valuations resemble GPL’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 6.9 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $5 million in GPL’s case. The Container Store Group Inc (NYSE:TCS) is the most popular stock in this table. On the other hand Source Capital, Inc. (NYSE:SOR) is the least popular one with only 2 bullish hedge fund positions. Great Panther Mining Ltd (NYSE:GPL) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for GPL is 37.3. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through November 27th and surpassed the market again by 16.1 percentage points. Unfortunately GPL wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); GPL investors were disappointed as the stock returned -6.7% since the end of September (through 11/27) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

Disclosure: None. This article was originally published at Insider Monkey.