At Insider Monkey, we pore over the filings of nearly 817 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we've gathered as a result gives us access to a wealth of collective knowledge based on these firms' portfolio holdings as of September 30. In this article, we will use that wealth of knowledge to determine whether or not Getty Realty Corp. (NYSE:GTY) makes for a good investment right now.
Is GTY a good stock to buy now? Getty Realty Corp. (NYSE:GTY) shareholders have witnessed an increase in hedge fund interest in recent months. Getty Realty Corp. (NYSE:GTY) was in 12 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistics is 11. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 7 hedge funds in our database with GTY positions at the end of the second quarter. Our calculations also showed that GTY isn't among the 30 most popular stocks among hedge funds (click for Q3 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.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
David E. Shaw of D.E. Shaw
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. 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 website. Keeping this in mind we're going to take a gander at the recent hedge fund action surrounding Getty Realty Corp. (NYSE:GTY).
Do Hedge Funds Think GTY Is A Good Stock To Buy Now?
At third quarter's end, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 71% from the second quarter of 2020. The graph below displays the number of hedge funds with bullish position in GTY over the last 21 quarters. With hedgies' positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Getty Realty Corp. (NYSE:GTY), which was worth $52.3 million at the end of the third quarter. On the second spot was Two Sigma Advisors which amassed $4.1 million worth of shares. Millennium Management, D E Shaw, and AQR Capital Management 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 Zebra Capital Management allocated the biggest weight to Getty Realty Corp. (NYSE:GTY), around 1.1% of its 13F portfolio. Navellier & Associates is also relatively very bullish on the stock, setting aside 0.1 percent of its 13F equity portfolio to GTY.
With a general bullishness amongst the heavyweights, some big names have jumped into Getty Realty Corp. (NYSE:GTY) headfirst. Millennium Management, managed by Israel Englander, created the most valuable position in Getty Realty Corp. (NYSE:GTY). Millennium Management had $1.6 million invested in the company at the end of the quarter. D. E. Shaw's D E Shaw also made a $1.3 million investment in the stock during the quarter. The other funds with brand new GTY positions are Paul Tudor Jones's Tudor Investment Corp, Donald Sussman's Paloma Partners, and Noam Gottesman's GLG Partners.
Let's check out hedge fund activity in other stocks similar to Getty Realty Corp. (NYSE:GTY). We will take a look at Realogy Holdings Corp (NYSE:RLGY), K12 Inc. (NYSE:LRN), Black Diamond Therapeutics, Inc. (NASDAQ:BDTX), Middlesex Water Company (NASDAQ:MSEX), Fresh Del Monte Produce Inc (NYSE:FDP), Sandy Spring Bancorp Inc. (NASDAQ:SASR), and Grupo Simec S.A.B. de C.V. (NYSE:SIM). This group of stocks' market values are similar to GTY's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position RLGY,27,293185,3 LRN,23,152307,5 BDTX,13,171473,-4 MSEX,5,42002,0 FDP,12,24345,1 SASR,6,24116,-4 SIM,1,1804,0 Average,12.4,101319,0.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.4 hedge funds with bullish positions and the average amount invested in these stocks was $101 million. That figure was $65 million in GTY's case. Realogy Holdings Corp (NYSE:RLGY) is the most popular stock in this table. On the other hand Grupo Simec S.A.B. de C.V. (NYSE:SIM) is the least popular one with only 1 bullish hedge fund positions. Getty Realty Corp. (NYSE:GTY) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for GTY is 61.2. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and beat the market by 16.2 percentage points. A small number of hedge funds were also right about betting on GTY, though not to the same extent, as the stock returned 11.1% since the end of Q3 (through December 8th) and outperformed the market.
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Disclosure: None. This article was originally published at Insider Monkey.