The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Select Interior Concepts, Inc. (NASDAQ:SIC).
Is Select Interior Concepts, Inc. (NASDAQ:SIC) a cheap investment right now? Hedge funds are in an optimistic mood. The number of long hedge fund bets inched up by 5 lately. Our calculations also showed that SIC isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). SIC was in 14 hedge funds' portfolios at the end of September. There were 9 hedge funds in our database with SIC 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.
Today there are several metrics market participants can use to analyze stocks. A couple of the less known metrics are hedge fund and insider trading activity. We have shown that, historically, those who follow the best picks of the elite hedge fund managers can beat the broader indices by a healthy amount (see the details here).
[caption id="attachment_733253" align="aligncenter" width="473"] Arnaud Ajdler of Engine Capital[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Discover is offering this insane cashback card, so we look into shorting the stock. 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 even check out this option genius' weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager's investor letter and the stock already gained 20 percent. Now let's take a peek at the latest hedge fund action surrounding Select Interior Concepts, Inc. (NASDAQ:SIC).
How have hedgies been trading Select Interior Concepts, Inc. (NASDAQ:SIC)?
Heading into the fourth quarter of 2019, a total of 14 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 56% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards SIC over the last 17 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Select Interior Concepts, Inc. (NASDAQ:SIC) was held by ADW Capital, which reported holding $33.5 million worth of stock at the end of September. It was followed by Nantahala Capital Management with a $8.5 million position. Other investors bullish on the company included Perceptive Advisors, Nokomis Capital, and Intrepid Capital Management. In terms of the portfolio weights assigned to each position ADW Capital allocated the biggest weight to Select Interior Concepts, Inc. (NASDAQ:SIC), around 36.26% of its 13F portfolio. Intrepid Capital Management is also relatively very bullish on the stock, setting aside 2.11 percent of its 13F equity portfolio to SIC.
As industrywide interest jumped, specific money managers have been driving this bullishness. Perceptive Advisors, managed by Joseph Edelman, assembled the most valuable position in Select Interior Concepts, Inc. (NASDAQ:SIC). Perceptive Advisors had $5.7 million invested in the company at the end of the quarter. Arnaud Ajdler's Engine Capital also made a $0.8 million investment in the stock during the quarter. The following funds were also among the new SIC investors: John Overdeck and David Siegel's Two Sigma Advisors, Noam Gottesman's GLG Partners, and Michael Gelband's ExodusPoint Capital.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Select Interior Concepts, Inc. (NASDAQ:SIC) but similarly valued. These stocks are Willis Lease Finance Corporation (NASDAQ:WLFC), Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), Cellcom Israel Ltd. (NYSE:CEL), and Priority Technology Holdings, Inc. (NASDAQ:PRTH). This group of stocks' market values resemble SIC's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WLFC,4,26710,1 ASPS,9,50131,0 CEL,2,10880,0 PRTH,3,3524,1 Average,4.5,22811,0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 4.5 hedge funds with bullish positions and the average amount invested in these stocks was $23 million. That figure was $62 million in SIC's case. Altisource Portfolio Solutions S.A. (NASDAQ:ASPS) is the most popular stock in this table. On the other hand Cellcom Israel Ltd. (NYSE:CEL) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Select Interior Concepts, Inc. (NASDAQ:SIC) is more popular among hedge funds. 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. Unfortunately SIC wasn't nearly as popular as these 20 stocks and hedge funds that were betting on SIC were disappointed as the stock returned -20.6% during the first two months of the fourth quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market in Q4.
Disclosure: None. This article was originally published at Insider Monkey.