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Hedge Funds Are Crazy About Hallador Energy Co (HNRG)

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  • HNRG

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 Hallador Energy Co (NASDAQ:HNRG) based on that data.

Is Hallador Energy Co (NASDAQ:HNRG) a buy here? Investors who are in the know are in a bullish mood. The number of long hedge fund positions increased by 1 recently. Our calculations also showed that HNRG 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.

In today’s marketplace there are numerous methods stock traders can use to analyze publicly traded companies. A couple of the less known methods are hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the best picks of the best money managers can outclass the S&P 500 by a healthy margin (see the details here).

[caption id="attachment_728717" align="aligncenter" width="393"]

Roger Ibbotson of Zebra Capital Management[/caption]

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let's analyze the new hedge fund action encompassing Hallador Energy Co (NASDAQ:HNRG).

How have hedgies been trading Hallador Energy Co (NASDAQ:HNRG)?

At the end of the first quarter, a total of 9 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 13% from the previous quarter. On the other hand, there were a total of 7 hedge funds with a bullish position in HNRG a year ago. With hedge funds' capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).

Among these funds, Renaissance Technologies held the most valuable stake in Hallador Energy Co (NASDAQ:HNRG), which was worth $0.5 million at the end of the third quarter. On the second spot was Cove Street Capital which amassed $0.3 million worth of shares. Oldfield Partners, Zebra Capital Management, and Voss Capital 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 Hallador Energy Co (NASDAQ:HNRG), around 0.11% of its 13F portfolio. Voss Capital is also relatively very bullish on the stock, dishing out 0.09 percent of its 13F equity portfolio to HNRG.

As aggregate interest increased, specific money managers have jumped into Hallador Energy Co (NASDAQ:HNRG) headfirst. Voss Capital, managed by Travis Cocke, initiated the most outsized position in Hallador Energy Co (NASDAQ:HNRG). Voss Capital had $0.1 million invested in the company at the end of the quarter. Israel Englander's Millennium Management also initiated a $0 million position during the quarter.

Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Hallador Energy Co (NASDAQ:HNRG) but similarly valued. We will take a look at ClearOne Inc (NASDAQ:CLRO), Fujian Blue Hat Interactive Entertainment Technology Ltd. (NASDAQ:BHAT), Great Elm Capital Corp. (NASDAQ:GECC), and Vertex Energy Inc (NASDAQ:VTNR). All of these stocks' market caps are similar to HNRG's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CLRO,1,450,0 BHAT,1,12,0 GECC,3,522,0 VTNR,7,2580,2 Average,3,891,0.5 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 3 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $1 million in HNRG's case. Vertex Energy Inc (NASDAQ:VTNR) is the most popular stock in this table. On the other hand ClearOne Inc (NASDAQ:CLRO) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Hallador Energy Co (NASDAQ:HNRG) is more popular among hedge funds. 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 13.4% in 2020 through June 22nd and still beat the market by 15.9 percentage points. Unfortunately HNRG wasn't nearly as popular as these 10 stocks and hedge funds that were betting on HNRG were disappointed as the stock returned -18.1% during the second quarter (through June 22nd) 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 most of these stocks already outperformed the market in 2020.

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Disclosure: None. This article was originally published at Insider Monkey.

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