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Is Ardmore Shipping Corp (ASC) A Good Stock To Buy?

Nina Todic

We at Insider Monkey have gone over 738 13F filings that hedge funds and famous value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of March 31st. In this article we look at what those investors think of Ardmore Shipping Corp (NYSE:ASC).

Ardmore Shipping Corp (NYSE:ASC) has seen a decrease in enthusiasm from smart money of late. Our calculations also showed that ASC isn't among the 30 most popular stocks among hedge funds.

If you'd ask most investors, hedge funds are assumed to be underperforming, outdated financial tools of yesteryear. While there are greater than 8000 funds with their doors open at the moment, Our experts choose to focus on the aristocrats of this group, approximately 750 funds. These money managers orchestrate the majority of all hedge funds' total asset base, and by keeping an eye on their highest performing investments, Insider Monkey has identified a number of investment strategies that have historically outstripped the broader indices. Insider Monkey's flagship hedge fund strategy outstripped the S&P 500 index by around 5 percentage points a year since its inception in May 2014 through June 18th. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 28.2% since February 2017 (through June 18th) even though the market was up nearly 30% during the same period. We just shared a list of 5 short targets in our latest quarterly update and they are already down an average of 8.2% in a month whereas our long picks outperformed the market by 2.5 percentage points in this volatile 5 week period (our long picks also beat the market by 15 percentage points so far this year).

Clint Carlson, Carlson Capital

We're going to view the fresh hedge fund action encompassing Ardmore Shipping Corp (NYSE:ASC).

How have hedgies been trading Ardmore Shipping Corp (NYSE:ASC)?

Heading into the second quarter of 2019, a total of 9 of the hedge funds tracked by Insider Monkey were long this stock, a change of -10% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards ASC over the last 15 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

No of Hedge Funds with ASC Positions

More specifically, Royce & Associates was the largest shareholder of Ardmore Shipping Corp (NYSE:ASC), with a stake worth $11.2 million reported as of the end of March. Trailing Royce & Associates was Portolan Capital Management, which amassed a stake valued at $4 million. Renaissance Technologies, GLG Partners, and Carlson Capital were also very fond of the stock, giving the stock large weights in their portfolios.

Because Ardmore Shipping Corp (NYSE:ASC) has experienced bearish sentiment from hedge fund managers, it's easy to see that there were a few funds that elected to cut their entire stakes last quarter. It's worth mentioning that Keith M. Rosenbloom's Cruiser Capital Advisors said goodbye to the biggest position of the "upper crust" of funds tracked by Insider Monkey, comprising an estimated $0.2 million in stock, and Vince Maddi and Shawn Brennan's SIR Capital Management was right behind this move, as the fund cut about $0.2 million worth. These moves are important to note, as aggregate hedge fund interest was cut by 1 funds last quarter.

Let's also examine hedge fund activity in other stocks similar to Ardmore Shipping Corp (NYSE:ASC). These stocks are Lifevantage Corporation (NASDAQ:LFVN), Foamix Pharmaceuticals Ltd (NASDAQ:FOMX), Unity Bancorp, Inc. (NASDAQ:UNTY), and Net 1 UEPS Technologies Inc (NASDAQ:UEPS). This group of stocks' market caps are similar to ASC's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position LFVN,11,23500,0 FOMX,15,66772,0 UNTY,4,29798,0 UEPS,10,68145,-3 Average,10,47054,-0.75 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $47 million. That figure was $21 million in ASC's case. Foamix Pharmaceuticals Ltd (NASDAQ:FOMX) is the most popular stock in this table. On the other hand Unity Bancorp, Inc. (NASDAQ:UNTY) is the least popular one with only 4 bullish hedge fund positions. Ardmore Shipping Corp (NYSE:ASC) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. A small number of hedge funds were also right about betting on ASC, though not to the same extent, as the stock returned 5% during the same time frame and outperformed the market as well.

Disclosure: None. This article was originally published at Insider Monkey.

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