After several tireless days we have finished crunching the numbers from nearly 817 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Kimco Realty Corp (NYSE:KIM).
Is Kimco Realty Corp (NYSE:KIM) a worthy investment today? Investors who are in the know were reducing their bets on the stock. The number of bullish hedge fund positions retreated by 6 lately. Kimco Realty Corp (NYSE:KIM) was in 22 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 28. Our calculations also showed that KIM 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). There were 28 hedge funds in our database with KIM positions at the end of the second quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 66 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’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Minhua Zhang of Weld Capital Management
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. With all of this in mind let’s view the fresh hedge fund action encompassing Kimco Realty Corp (NYSE:KIM).
Do Hedge Funds Think KIM Is A Good Stock To Buy Now?
At the end of September, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of -21% from the previous quarter. On the other hand, there were a total of 12 hedge funds with a bullish position in KIM a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Citadel Investment Group was the largest shareholder of Kimco Realty Corp (NYSE:KIM), with a stake worth $90.5 million reported as of the end of September. Trailing Citadel Investment Group was Balyasny Asset Management, which amassed a stake valued at $21 million. Kettle Hill Capital Management, D E Shaw, and Renaissance Technologies were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Hill Winds Capital allocated the biggest weight to Kimco Realty Corp (NYSE:KIM), around 4.49% of its 13F portfolio. Kettle Hill Capital Management is also relatively very bullish on the stock, dishing out 4.33 percent of its 13F equity portfolio to KIM.
Since Kimco Realty Corp (NYSE:KIM) has witnessed bearish sentiment from the smart money, we can see that there exists a select few hedgies that decided to sell off their positions entirely by the end of the third quarter. Intriguingly, Stuart J. Zimmer’s Zimmer Partners said goodbye to the biggest position of all the hedgies watched by Insider Monkey, totaling an estimated $67.4 million in stock. Eduardo Abush’s fund, Waterfront Capital Partners, also sold off its stock, about $18.3 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest dropped by 6 funds by the end of the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Kimco Realty Corp (NYSE:KIM). These stocks are Berkeley Lights, Inc. (NASDAQ:BLI), AppFolio Inc (NASDAQ:APPF), Globus Medical Inc (NYSE:GMED), Iovance Biotherapeutics, Inc. (NASDAQ:IOVA), Landstar System, Inc. (NASDAQ:LSTR), The Descartes Systems Group Inc (NASDAQ:DSGX), and American Campus Communities, Inc. (NYSE:ACC). This group of stocks’ market valuations match KIM’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BLI | 10 | 53013 | 10 |
| APPF | 26 | 336756 | 5 |
| GMED | 33 | 100676 | 1 |
| IOVA | 40 | 1475319 | -3 |
| LSTR | 23 | 210116 | 0 |
| DSGX | 12 | 212088 | 2 |
| ACC | 21 | 349316 | -5 |
| Average | 23.6 | 391041 | 1.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.6 hedge funds with bullish positions and the average amount invested in these stocks was $391 million. That figure was $184 million in KIM’s case. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is the most popular stock in this table. On the other hand Berkeley Lights, Inc. (NASDAQ:BLI) is the least popular one with only 10 bullish hedge fund positions. Kimco Realty Corp (NYSE:KIM) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for KIM is 42.6. 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 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 December 14th and still beat the market by 15.8 percentage points. A small number of hedge funds were also right about betting on KIM as the stock returned 29.5% since the end of the third quarter (through 12/14) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
