If you enjoyed popping those air bubbles that came along with many home delivered packages, there is some bad news for you. The original manufacturer of the Bubble Wrap, which was created in 1960, Sealed Air Corp (NYSE:SEE), has launched a new version of the packaging material, iBubble Wrap, that doesn’t pop. iBubble Wrap ships as flat plastic sheets that can later be inflated with a custom air pump sold by the company. According to the company, the new bubble wrap will help it control the shipping cost of the packaging material and save warehouse space for its customers, with the former bubble wrap coming on giant rolls. Sealed Air Corp (NYSE:SEE) is hopeful that this new version of Bubble Wrap has the potential to rejuvenate the brand, which has lost its market share amid increasing competition. The packaging material manufacturer hasn’t been able to cash in on the boom in the e-commerce sector primarily because it’s unable to ship the packaging material to far-flung clients because of its size. Market experts welcomed the new product, although they are skeptical about the cost of the air pump ($5,500), which is needed to inflate the rolls. Whereas the previous bubble wrap had singular pockets of air that could easily and satisfyingly be popped by hand, the new rolls make use of long strips of air that run along the entire length of wrap, and are virtually impossible to pop by hand.
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The launch of iBubble Wrap could turn things around for Sealed Air Corp (NYSE:SEE) in the upcoming months. The shares of the packaging material company have grown by 20.88% year-to-date and its shares have received a positive outlook from Smart Money. According to the 13Fs filed by hedge funds as of the end of the first quarter, 48 hedge funds tracked by Insider Monkey held positions in Sealed Air Corp (NYSE:SEE), with holdings totaling $2.54 billion in value, which is higher than the previous quarter investments of $1.99 billion.
We don’t just track the latest moves of funds. We are, in fact, more interested in their 13F filings, which we use to determine the top 15 small-cap stocks held by the funds we track. We gather and share this information based on 16 years of research, with backtests for the period between 1999 and 2012 and forward testing for the last 2.5 years. The results of our analysis show that these 15 most popular small-cap picks have a great potential to outperform the market, beating the S&P 500 Total Return Index by nearly one percentage point per month in backtests. Moreover, since the beginning of forward testing in August 2012, the strategy worked brilliantly, outperforming the market every year and returning 135%, which is more than 80 percentage points higher than the returns of the S&P 500 ETF (SPY) (see more details).
In addition to positive hedge fund sentiment, insiders are optimistic about the growth potential of Sealed Air Corp. William Marino, Director at Sealed Air Corp., boosted his stake in the company by purchasing 3,213 shares in June.
With all of this in mind, let’s go over the latest hedgie action surrounding Sealed Air Corp (NYSE:SEE).
What have hedge funds been doing with Sealed Air Corp (NYSE:SEE)?
At the end of the first quarter, a total of 48 of the hedge funds tracked by Insider Monkey held long positions in this stock, with no change from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes meaningfully.
According to hedge fund experts at Insider Monkey, Andreas Halvorsen‘s Viking Global had the most valuable position in Sealed Air Corp (NYSE:SEE), worth close to $659.5 million and 14.48 million shares, corresponding to 2.6% of its total 13F portfolio. The second-largest stake is held by David Cohen and Harold Levy of Iridian Asset Management, who hold a $609.6 million position; 5.1% of their 13F portfolio is allocated to the company. Other hedgies that hold long positions encompass John Lykouretzos’ Hoplite Capital Management, David E. Shaw’s D E Shaw and Robert Pitts’ Steadfast Capital Management.
Considering the positive hedge fund outlook and promising growth in the shares of Sealed Air Corp, we recommend a buy, even as the company destroys fond childhood memories with its new unpoppable bubble wrap.
Disclosure: None
