We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Cameco Corporation (NYSE:CCJ) based on that data.
Cameco Corporation (NYSE:CCJ) investors should be aware of a decrease in hedge fund sentiment of late. CCJ was in 24 hedge funds' portfolios at the end of the first quarter of 2020. There were 28 hedge funds in our database with CCJ holdings at the end of the previous quarter. Our calculations also showed that CCJ isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). 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 58 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 36% through May 18th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
[caption id="attachment_728376" align="aligncenter" width="391"] Jonathan Barrett of Luminus Management[/caption]
We leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we are checking out investment opportunities like these. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let's take a peek at the new hedge fund action regarding Cameco Corporation (NYSE:CCJ).
What does smart money think about Cameco Corporation (NYSE:CCJ)?
At Q1's end, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, a change of -14% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in CCJ over the last 18 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Cameco Corporation (NYSE:CCJ) was held by Kopernik Global Investors, which reported holding $86.9 million worth of stock at the end of September. It was followed by Adage Capital Management with a $85.5 million position. Other investors bullish on the company included Moerus Capital Management, Yost Capital Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Kopernik Global Investors allocated the biggest weight to Cameco Corporation (NYSE:CCJ), around 18.51% of its 13F portfolio. Yost Capital Management is also relatively very bullish on the stock, dishing out 13.69 percent of its 13F equity portfolio to CCJ.
Because Cameco Corporation (NYSE:CCJ) has witnessed a decline in interest from hedge fund managers, it's safe to say that there lies a certain "tier" of funds who were dropping their full holdings last quarter. Interestingly, David Rosen's Rubric Capital Management dumped the biggest position of the "upper crust" of funds watched by Insider Monkey, comprising an estimated $20.1 million in stock. Rob Citrone's fund, Discovery Capital Management, also said goodbye to its stock, about $11.4 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest dropped by 4 funds last quarter.
Let's now review hedge fund activity in other stocks similar to Cameco Corporation (NYSE:CCJ). These stocks are Pan American Silver Corp. (NASDAQ:PAAS), American States Water Co (NYSE:AWR), AerCap Holdings N.V. (NYSE:AER), and BOK Financial Corporation (NASDAQ:BOKF). This group of stocks' market caps are closest to CCJ's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PAAS,30,341386,0 AWR,19,50907,-2 AER,32,616402,-4 BOKF,22,145009,7 Average,25.75,288426,0.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.75 hedge funds with bullish positions and the average amount invested in these stocks was $288 million. That figure was $268 million in CCJ's case. AerCap Holdings N.V. (NYSE:AER) is the most popular stock in this table. On the other hand American States Water Co (NYSE:AWR) is the least popular one with only 19 bullish hedge fund positions. Cameco Corporation (NYSE:CCJ) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th and still beat the market by 14.2 percentage points. A small number of hedge funds were also right about betting on CCJ as the stock returned 36.8% during the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.