Is Cooper Tire & Rubber Company (NYSE:CTB) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.
Is Cooper Tire & Rubber Company (NYSE:CTB) a buy, sell, or hold? The smart money is getting more bullish. The number of long hedge fund bets moved up by 3 recently. Our calculations also showed that CTB isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). CTB was in 18 hedge funds' portfolios at the end of the third quarter of 2019. There were 15 hedge funds in our database with CTB positions at the end of the previous quarter. Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most stock holders, hedge funds are perceived as slow, old investment tools of years past. While there are greater than 8000 funds in operation at present, Our researchers look at the crème de la crème of this club, approximately 750 funds. It is estimated that this group of investors watch over the lion's share of the hedge fund industry's total asset base, and by following their finest equity investments, Insider Monkey has brought to light a number of investment strategies that have historically surpassed the market. Insider Monkey's flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points annually since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .
[caption id="attachment_365194" align="aligncenter" width="450"] David E. Shaw of D.E. Shaw[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world's largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, "I'm investing more today than I did back in early 2009." So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds' buy/sell signals. We're going to take a peek at the fresh hedge fund action regarding Cooper Tire & Rubber Company (NYSE:CTB).
How have hedgies been trading Cooper Tire & Rubber Company (NYSE:CTB)?
At Q3's end, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 20% from the second quarter of 2019. Below, you can check out the change in hedge fund sentiment towards CTB over the last 17 quarters. With hedge funds' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
More specifically, Royce & Associates was the largest shareholder of Cooper Tire & Rubber Company (NYSE:CTB), with a stake worth $34.4 million reported as of the end of September. Trailing Royce & Associates was Citadel Investment Group, which amassed a stake valued at $25.7 million. Arrowstreet Capital, Millennium Management, and D E Shaw 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 Rutabaga Capital Management allocated the biggest weight to Cooper Tire & Rubber Company (NYSE:CTB), around 2.81% of its 13F portfolio. Atlantic Investment Management is also relatively very bullish on the stock, dishing out 0.32 percent of its 13F equity portfolio to CTB.
As one would reasonably expect, key hedge funds have been driving this bullishness. Point72 Asset Management, managed by Steve Cohen, initiated the most valuable position in Cooper Tire & Rubber Company (NYSE:CTB). Point72 Asset Management had $6.5 million invested in the company at the end of the quarter. Martin Whitman's Third Avenue Management also made a $2.5 million investment in the stock during the quarter. The following funds were also among the new CTB investors: David Harding's Winton Capital Management, Alexander Roepers's Atlantic Investment Management, and Minhua Zhang's Weld Capital Management.
Let's now take a look at hedge fund activity in other stocks similar to Cooper Tire & Rubber Company (NYSE:CTB). We will take a look at Green Dot Corporation (NYSE:GDOT), Aimmune Therapeutics Inc (NASDAQ:AIMT), Conduent Incorporated (NYSE:CNDT), and Helios Technologies, Inc. (NASDAQ:HLIO). This group of stocks' market caps match CTB's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position GDOT,20,192467,2 AIMT,20,192504,7 CNDT,30,418046,3 HLIO,3,75356,-1 Average,18.25,219593,2.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.25 hedge funds with bullish positions and the average amount invested in these stocks was $220 million. That figure was $135 million in CTB's case. Conduent Incorporated (NYSE:CNDT) is the most popular stock in this table. On the other hand Helios Technologies, Inc. (NASDAQ:HLIO) is the least popular one with only 3 bullish hedge fund positions. Cooper Tire & Rubber Company (NYSE:CTB) 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 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. A small number of hedge funds were also right about betting on CTB as the stock returned 10.7% during the first two months of Q4 and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.