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Hedge Funds Never Been Less Bullish On Bassett Furniture Industries Inc. (BSET)

Asma UL Husna
·6 min read

The 800+ 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 Bassett Furniture Industries Inc. (NASDAQ:BSET).

Bassett Furniture Industries Inc. (NASDAQ:BSET) investors should be aware of a decrease in enthusiasm from smart money recently. Bassett Furniture Industries Inc. (NASDAQ:BSET) was in 5 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistics is 12. There were 9 hedge funds in our database with BSET holdings at the end of June. Our calculations also showed that BSET 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.

According to most shareholders, hedge funds are perceived as underperforming, old investment vehicles of years past. While there are more than 8000 funds with their doors open today, We choose to focus on the leaders of this group, around 850 funds. Most estimates calculate that this group of people have their hands on the lion's share of all hedge funds' total asset base, and by tailing their finest picks, Insider Monkey has unearthed many investment strategies that have historically defeated the market. Insider Monkey's flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .

John Overdeck of Two Sigma
John Overdeck of Two Sigma

John Overdeck of Two Sigma Advisors

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. Now we're going to analyze the fresh hedge fund action surrounding Bassett Furniture Industries Inc. (NASDAQ:BSET).

How have hedgies been trading Bassett Furniture Industries Inc. (NASDAQ:BSET)?

At the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -44% from the previous quarter. On the other hand, there were a total of 9 hedge funds with a bullish position in BSET a year ago. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Bassett Furniture Industries Inc. (NASDAQ:BSET) was held by GAMCO Investors, which reported holding $12.3 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $8.5 million position. Other investors bullish on the company included Arrowstreet Capital, Ancora Advisors, and Two Sigma Advisors. In terms of the portfolio weights assigned to each position GAMCO Investors allocated the biggest weight to Bassett Furniture Industries Inc. (NASDAQ:BSET), around 0.14% of its 13F portfolio. Ancora Advisors is also relatively very bullish on the stock, dishing out 0.04 percent of its 13F equity portfolio to BSET.

Seeing as Bassett Furniture Industries Inc. (NASDAQ:BSET) has experienced bearish sentiment from hedge fund managers, it's safe to say that there was a specific group of fund managers who were dropping their full holdings last quarter. At the top of the heap, D. E. Shaw's D E Shaw said goodbye to the biggest investment of all the hedgies watched by Insider Monkey, totaling about $0.3 million in stock, and Ken Griffin's Citadel Investment Group was right behind this move, as the fund dropped about $0.2 million worth. These moves are important to note, as total hedge fund interest fell by 4 funds last quarter.

Let's go over hedge fund activity in other stocks similar to Bassett Furniture Industries Inc. (NASDAQ:BSET). These stocks are BCB Bancorp, Inc. (NASDAQ:BCBP), Infrastructure and Energy Alternatives, Inc. (NASDAQ:IEA), Lantronix Inc (NASDAQ:LTRX), Ocean Bio-Chem, Inc. (NASDAQ:OBCI), XpresSpa Group, Inc. (NASDAQ:XSPA), PFSweb, Inc. (NASDAQ:PFSW), and EDAP TMS S.A. (NASDAQ:EDAP). All of these stocks' market caps match BSET's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position BCBP,3,12669,-1 IEA,7,16703,0 LTRX,4,5861,0 OBCI,2,4284,1 XSPA,3,2502,0 PFSW,8,15762,1 EDAP,3,9159,0 Average,4.3,9563,0.1 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 4.3 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $23 million in BSET's case. PFSweb, Inc. (NASDAQ:PFSW) is the most popular stock in this table. On the other hand Ocean Bio-Chem, Inc. (NASDAQ:OBCI) is the least popular one with only 2 bullish hedge fund positions. Bassett Furniture Industries Inc. (NASDAQ:BSET) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for BSET is 38.5. 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 30.7% in 2020 through November 27th and still beat the market by 16.1 percentage points. Hedge funds were also right about betting on BSET as the stock returned 22.2% since the end of Q3 (through 11/27) 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.

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