The worries about the election and the ongoing uncertainty about the path of interest-rate increases have been keeping investors on the sidelines. Of course, most hedge funds and other asset managers have been underperforming main stock market indices since the middle of 2015. Interestingly though, smaller-cap stocks registered their best performance relative to the large-capitalization stocks since the end of the June quarter, suggesting that this may be the best time to take a cue from their stock picks. In fact, the Russell 2000 Index gained more than 15% since the beginning of the third quarter, while the Standard and Poor’s 500 benchmark returned less than 6%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH) .
Is Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH) a healthy stock for your portfolio? Money managers are buying. The number of long hedge fund positions that are disclosed in regulatory 13F filings inched up by 6 in recent months. CQHwas in 19 hedge funds’ portfolios at the end of the third quarter of 2016. There were 13 hedge funds in our database with CQH positions 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 Manpowergroup Inc (NYSE:MAN), Veeva Systems Inc (NYSE:VEEV), and Erie Indemnity Company (NASDAQ:ERIE) to gather more data points.
Follow Cheniere Energy Partners Lp Holdings Llc (NYSEMKT:CQH)
Follow Cheniere Energy Partners Lp Holdings Llc (NYSEMKT:CQH)
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How have hedgies been trading Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH)?
Heading into the fourth quarter of 2016, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a gain of 46% from the previous quarter. By comparison, 14 hedge funds held shares or bullish call options in CQH heading into this year. With the smart money’s positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Stuart J. Zimmer’s Zimmer Partners has the largest position in Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH), worth close to $184.8 million, corresponding to 5% of its total 13F portfolio. The second largest stake is held by Anchorage Advisors, led by Kevin Michael Ulrich and Anthony Davis, holding a $107 million position; the fund has 11% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors with similar optimism comprise Alan Fournier’s Pennant Capital Management, Richard Gerson and Navroz D. Udwadia’s Falcon Edge Capital and Phill Gross and Robert Atchinson’s Adage Capital Management. We should note that Zimmer Partners is among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
As one would reasonably expect, key hedge funds have jumped into Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH) headfirst. Luminus Management, led by Jonathan Barrett and Paul Segal, assembled the largest position in Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH). Luminus Management had $23.6 million invested in the company at the end of the quarter. Clint Carlson’s Carlson Capital also initiated a $9.3 million position during the quarter. The following funds were also among the new CQH investors: Howard Guberman’s Gruss Asset Management, Dmitry Balyasny’s Balyasny Asset Management, and John A. Levin’s Levin Capital Strategies.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH) but similarly valued. We will take a look at Manpowergroup Inc (NYSE:MAN), Veeva Systems Inc (NYSE:VEEV), Erie Indemnity Company (NASDAQ:ERIE), and Blue Buffalo Pet Products Inc (NASDAQ:BUFF). This group of stocks’ market valuations are similar to CQH’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MAN | 29 | 447052 | 5 |
| VEEV | 23 | 254286 | 2 |
| ERIE | 9 | 61054 | -1 |
| BUFF | 28 | 309153 | 2 |
As you can see these stocks had an average of 22 hedge funds with bullish positions and the average amount invested in these stocks was $268 million. That figure was $542 million in CQH’s case. Manpowergroup Inc (NYSE:MAN) is the most popular stock in this table. On the other hand Erie Indemnity Company (NASDAQ:ERIE) is the least popular one with only 9 bullish hedge fund positions. Cheniere Energy Partners LP Holdings LLC (NYSEMKT:CQH) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard MAN might be a better candidate to consider taking a long position in.
Disclosure: None
