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In this article we are going to use hedge fund sentiment as a tool and determine whether Brixmor Property Group Inc (NYSE:BRX) is a good investment right now. We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds' picks don't beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
Brixmor Property Group Inc (NYSE:BRX) shareholders have witnessed an increase in support from the world's most elite money managers recently. Brixmor Property Group Inc (NYSE:BRX) was in 18 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 28. There were 6 hedge funds in our database with BRX holdings at the end of December. Our calculations also showed that BRX isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
If you'd ask most shareholders, hedge funds are viewed as underperforming, outdated investment vehicles of the past. While there are over 8000 funds with their doors open at the moment, Our researchers look at the upper echelon of this group, around 850 funds. These investment experts watch over bulk of the hedge fund industry's total asset base, and by paying attention to their unrivaled stock picks, Insider Monkey has determined many investment strategies that have historically defeated the broader indices. Insider Monkey's flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Also, our monthly newsletter's portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .
Ken Heebner of Capital Growth Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. 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 take a peek at the recent hedge fund action encompassing Brixmor Property Group Inc (NYSE:BRX).
Do Hedge Funds Think BRX Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 200% from the previous quarter. By comparison, 28 hedge funds held shares or bullish call options in BRX a year ago. With hedge funds' positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
The largest stake in Brixmor Property Group Inc (NYSE:BRX) was held by Waterfront Capital Partners, which reported holding $21.9 million worth of stock at the end of December. It was followed by Capital Growth Management with a $19.6 million position. Other investors bullish on the company included Balyasny Asset Management, Millennium Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Hill Winds Capital allocated the biggest weight to Brixmor Property Group Inc (NYSE:BRX), around 3.88% of its 13F portfolio. Waterfront Capital Partners is also relatively very bullish on the stock, setting aside 1.98 percent of its 13F equity portfolio to BRX.
Now, key hedge funds were leading the bulls' herd. Waterfront Capital Partners, managed by Eduardo Abush, initiated the largest position in Brixmor Property Group Inc (NYSE:BRX). Waterfront Capital Partners had $21.9 million invested in the company at the end of the quarter. Dmitry Balyasny's Balyasny Asset Management also made a $15.7 million investment in the stock during the quarter. The following funds were also among the new BRX investors: Israel Englander's Millennium Management, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, and Daniel Johnson's Gillson Capital.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Brixmor Property Group Inc (NYSE:BRX) but similarly valued. We will take a look at Ardagh Group S.A. (NYSE:ARD), Nordstrom, Inc. (NYSE:JWN), Virtu Financial Inc (NASDAQ:VIRT), Halozyme Therapeutics, Inc. (NASDAQ:HALO), Choice Hotels International, Inc. (NYSE:CHH), American Campus Communities, Inc. (NYSE:ACC), and Acuity Brands, Inc. (NYSE:AYI). This group of stocks' market values are similar to BRX's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ARD,11,125401,3 JWN,34,293042,0 VIRT,22,301753,-5 HALO,23,210743,-2 CHH,17,123430,2 ACC,26,231239,11 AYI,31,969322,2 Average,23.4,322133,1.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.4 hedge funds with bullish positions and the average amount invested in these stocks was $322 million. That figure was $128 million in BRX's case. Nordstrom, Inc. (NYSE:JWN) is the most popular stock in this table. On the other hand Ardagh Group S.A. (NYSE:ARD) is the least popular one with only 11 bullish hedge fund positions. Brixmor Property Group Inc (NYSE:BRX) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for BRX is 44.5. 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 28.5% in 2021 through July 23rd and beat the market by 10.1 percentage points. A small number of hedge funds were also right about betting on BRX, though not to the same extent, as the stock returned 12.6% since the end of Q1 (through July 23rd) and outperformed the market.
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Disclosure: None. This article was originally published at Insider Monkey.