Should You Buy Ramco-Gershenson Properties Trust (RPT)?

We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Ackman’s recent Valeant losses). However, it is still good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Ramco-Gershenson Properties Trust (NYSE:RPT).

Is Ramco-Gershenson Properties Trust worth your attention right now? Hedge funds are taking an optimistic view. The number of bullish hedge fund bets advanced by 1 lately. 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 TASER International, Inc. (NASDAQ:TASR), Gramercy Property Trust Inc (NYSE:GPT), and Wesco Aircraft Holdings Inc (NYSE:WAIR) to gather more data points.

To most market participants, hedge funds are assumed to be slow, old investment tools of yesteryear. While there are over 8000 funds in operation at present, We hone in on the moguls of this club, about 700 funds. It is estimated that this group of investors shepherd the majority of the smart money’s total capital, and by keeping an eye on their first-class stock picks, Insider Monkey has uncovered several investment strategies that have historically outpaced the market. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 12 percentage points per year for a decade in their back tests.

With all of this in mind, let’s take a gander at the latest action surrounding Ramco-Gershenson Properties Trust (NYSE:RPT).

What does the smart money think about Ramco-Gershenson Properties Trust (NYSE:RPT)?

Heading into Q4, a total of 16 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 7% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Forward Management, managed by J. Alan Reid, Jr., holds the number one position in Ramco-Gershenson Properties Trust (NYSE:RPT). Forward Management has a $13.7 million position in the stock, comprising 1.1% of its 13F portfolio. Sitting at the No. 2 spot is Jim Simons’ Renaissance Technologies, with a $10.9 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other peers that are bullish include Dmitry Balyasny’s Balyasny Asset Management and Israel Englander’s Millennium Management.

With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Segantii Capital, managed by Simon Sadler, initiated the largest position in Ramco-Gershenson Properties Trust (NYSE:RPT). Segantii Capital had $6.5 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also made a $5 million investment in the stock during the quarter. The following funds were also among the new RPT investors: Peter Muller’s PDT Partners, Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital, and Paul Tudor Jones’s Tudor Investment Corp.

Let’s now take a look at hedge fund activity in other stocks similar to Ramco-Gershenson Properties Trust (NYSE:RPT). We will take a look at TASER International, Inc. (NASDAQ:TASR), Gramercy Property Trust Inc (NYSE:GPT), Wesco Aircraft Holdings Inc (NYSE:WAIR), and BBCN Bancorp, Inc. (NASDAQ:BBCN). This group of stocks’ market values are similar to RPT’s market value.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $148 million, versus $63 million in RPT’s case. TASER International, Inc. (NASDAQ:TASR) is the most popular stock in this table with 15 funds holding shares. On the other hand, BBCN Bancorp, Inc. (NASDAQ:BBCN) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Ramco-Gershenson Properties Trust (NYSE:RPT) 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.