The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider TransGlobe Energy Corporation (NASDAQ:TGA) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
TransGlobe Energy Corporation (NASDAQ:TGA) has seen an increase in hedge fund sentiment of late. TransGlobe Energy Corporation (NASDAQ:TGA) was in 3 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 5. Our calculations also showed that TGA isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Ken Griffin of Citadel Investment Group
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $28 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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 homepage. With all of this in mind we’re going to view the fresh hedge fund action regarding TransGlobe Energy Corporation (NASDAQ:TGA).
Do Hedge Funds Think TGA Is A Good Stock To Buy Now?
At first quarter’s end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 50% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards TGA over the last 23 quarters. So, let’s see 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, holds the most valuable position in TransGlobe Energy Corporation (NASDAQ:TGA). Renaissance Technologies has a $5.1 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Millennium Management, led by Israel Englander, holding a $0.1 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. In terms of the portfolio weights assigned to each position Renaissance Technologies allocated the biggest weight to TransGlobe Energy Corporation (NASDAQ:TGA), around 0.01% of its 13F portfolio. Millennium Management is also relatively very bullish on the stock, dishing out 0 percent of its 13F equity portfolio to TGA.
Now, specific money managers have been driving this bullishness. Citadel Investment Group, managed by Ken Griffin, assembled the biggest position in TransGlobe Energy Corporation (NASDAQ:TGA). Citadel Investment Group had $0 million invested in the company at the end of the quarter.
Let’s now take a look at hedge fund activity in other stocks similar to TransGlobe Energy Corporation (NASDAQ:TGA). These stocks are Sachem Capital Corp. (NYSE:SACH), Rhinebeck Bancorp, Inc. (NASDAQ:RBKB), WISeKey International Holding AG (NASDAQ:WKEY), Everspin Technologies, Inc. (NASDAQ:MRAM), Ocean Bio-Chem, Inc. (NASDAQ:OBCI), Caladrius Biosciences Inc (NASDAQ:CLBS), and Allied Esports Entertainment, Inc. (NASDAQ:AESE). This group of stocks’ market valuations match TGA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SACH | 1 | 1016 | 0 |
| RBKB | 3 | 7262 | 0 |
| WKEY | 3 | 662 | 1 |
| MRAM | 5 | 2030 | 0 |
| OBCI | 3 | 5377 | -1 |
| CLBS | 5 | 3949 | 2 |
| AESE | 2 | 414 | 0 |
| Average | 3.1 | 2959 | 0.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 3.1 hedge funds with bullish positions and the average amount invested in these stocks was $3 million. That figure was $5 million in TGA’s case. Everspin Technologies, Inc. (NASDAQ:MRAM) is the most popular stock in this table. On the other hand Sachem Capital Corp. (NYSE:SACH) is the least popular one with only 1 bullish hedge fund positions. TransGlobe Energy Corporation (NASDAQ:TGA) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TGA is 49. 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. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th and still beat the market by 3.3 percentage points. A small number of hedge funds were also right about betting on TGA as the stock returned 19% since the end of the first quarter (through 6/11) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
