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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 Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY) based on that data.
Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY) was in 7 hedge funds' portfolios at the end of the first quarter of 2020. CRESY has seen an increase in hedge fund sentiment of late. There were 6 hedge funds in our database with CRESY holdings at the end of the previous quarter. Our calculations also showed that CRESY 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.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still 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 underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren't comfortable with shorting stocks, you should at least avoid initiating long positions in stocks that are in our short portfolio.
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Israel Englander of Millennium Management[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. 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. With all of this in mind let's view the new hedge fund action regarding Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY).
Hedge fund activity in Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY)
Heading into the second quarter of 2020, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 17% from one quarter earlier. On the other hand, there were a total of 7 hedge funds with a bullish position in CRESY a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Ari Zweiman's 683 Capital Partners has the most valuable position in Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY), worth close to $3.3 million, corresponding to 0.4% of its total 13F portfolio. The second most bullish fund manager is Ian Cumming and Joseph Steinberg of Leucadia National, with a $3 million position; the fund has 4% of its 13F portfolio invested in the stock. Other hedge funds and institutional investors with similar optimism contain Farhad Nanji and Michael DeMichele's MFN Partners, James Dondero's Highland Capital Management and Israel Englander's Millennium Management. In terms of the portfolio weights assigned to each position Leucadia National allocated the biggest weight to Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY), around 4.02% of its 13F portfolio. 683 Capital Partners is also relatively very bullish on the stock, dishing out 0.4 percent of its 13F equity portfolio to CRESY.
As aggregate interest increased, specific money managers have been driving this bullishness. Leucadia National, managed by Ian Cumming and Joseph Steinberg, created the biggest position in Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY). Leucadia National had $3 million invested in the company at the end of the quarter. Farhad Nanji and Michael DeMichele's MFN Partners also initiated a $2 million position during the quarter.
Let's now take a look at hedge fund activity in other stocks similar to Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY). We will take a look at Capital Bancorp, Inc. (NASDAQ:CBNK), P.A.M. Transportation Services, Inc. (NASDAQ:PTSI), Ardmore Shipping Corp (NYSE:ASC), and Mid Penn Bancorp (NASDAQ:MPB). All of these stocks' market caps are closest to CRESY's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CBNK,2,511,0 PTSI,1,11629,0 ASC,14,23341,4 MPB,4,4755,0 Average,5.25,10059,1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.25 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $10 million in CRESY's case. Ardmore Shipping Corp (NYSE:ASC) is the most popular stock in this table. On the other hand P.A.M. Transportation Services, Inc. (NASDAQ:PTSI) is the least popular one with only 1 bullish hedge fund positions. Cresud Sociedad Anonima Comercial, Inmobiliaria, Financiera y Agropecuaria (NASDAQ:CRESY) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. 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 but beat the market by 14.2 percentage points. Unfortunately CRESY wasn't nearly as popular as these 10 stocks and hedge funds that were betting on CRESY were disappointed as the stock returned 12.9% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.