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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Core Molding Technologies, Inc. (NYSE:CMT), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is Core Molding Technologies, Inc. (NYSE:CMT) a great investment right now? Investors who are in the know were getting less optimistic. The number of bullish hedge fund bets went down by 1 lately. Core Molding Technologies, Inc. (NYSE:CMT) was in 3 hedge funds' portfolios at the end of March. The all time high for this statistic is 8. Our calculations also showed that CMT isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
In the eyes of most stock holders, hedge funds are seen as worthless, old investment tools of the past. While there are greater than 8000 funds trading at the moment, Our experts look at the aristocrats of this club, approximately 850 funds. These investment experts orchestrate the lion's share of the hedge fund industry's total asset base, and by monitoring their best picks, Insider Monkey has brought to light various investment strategies that have historically outstripped the broader indices. Insider Monkey's flagship short hedge fund strategy outstripped 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 .
Jeffrey Gendell of Tontine Asset Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $26 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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. Keeping this in mind we're going to view the fresh hedge fund action regarding Core Molding Technologies, Inc. (NYSE:CMT).
Do Hedge Funds Think CMT Is A Good Stock To Buy Now?
At Q1's end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -25% from the previous quarter. On the other hand, there were a total of 4 hedge funds with a bullish position in CMT a year ago. With the smart money's capital changing hands, there exists a few notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Core Molding Technologies, Inc. (NYSE:CMT), which was worth $7.7 million at the end of the fourth quarter. On the second spot was GAMCO Investors which amassed $5.9 million worth of shares. Tontine Asset Management was 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 Tontine Asset Management allocated the biggest weight to Core Molding Technologies, Inc. (NYSE:CMT), around 0.39% of its 13F portfolio. GAMCO Investors is also relatively very bullish on the stock, dishing out 0.05 percent of its 13F equity portfolio to CMT.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Millennium Management. One hedge fund selling its entire position doesn't always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don't think this is the case in this case because none of the 750+ hedge funds tracked by Insider Monkey identified CMT as a viable investment and initiated a position in the stock.
Let's go over hedge fund activity in other stocks similar to Core Molding Technologies, Inc. (NYSE:CMT). These stocks are Sino-Global Shipping America, Ltd. (NASDAQ:SINO), Acasti Pharma Inc. (NASDAQ:ACST), Document Security Systems, Inc. (NYSE:DSS), SilverBow Resorces, Inc. (NYSE:SBOW), Cortland Bancorp (NASDAQ:CLDB), NexPoint Real Estate Finance, Inc. (NYSE:NREF), and Epsilon Energy Ltd. (NASDAQ:EPSN). This group of stocks' market valuations are similar to CMT's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SINO,1,169,1 ACST,1,31,-3 DSS,2,294,1 SBOW,4,36762,-2 CLDB,2,9927,0 NREF,2,3997,-2 EPSN,3,15485,1 Average,2.1,9524,-0.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.1 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $17 million in CMT's case. SilverBow Resorces, Inc. (NYSE:SBOW) is the most popular stock in this table. On the other hand Sino-Global Shipping America, Ltd. (NASDAQ:SINO) is the least popular one with only 1 bullish hedge fund positions. Core Molding Technologies, Inc. (NYSE:CMT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CMT is 48.6. 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 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 17.2% in 2021 through June 11th and still beat the market by 3.3 percentage points. Hedge funds were also right about betting on CMT as the stock returned 13.4% since the end of Q1 (through 6/11) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.