Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and investors' positions as of the end of the fourth quarter. You can find write-ups about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves and analyze what the smart money thinks of Ashland Global Holdings Inc.. (NYSE:ASH) based on that data.
Ashland Global Holdings Inc.. (NYSE:ASH) investors should pay attention to an increase in enthusiasm from smart money recently. Our calculations also showed that ASH isn't among the 30 most popular stocks among hedge funds.
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 market by 32 percentage points since May 2014 through March 12, 2019 (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 our short portfolio.
Let's review the recent hedge fund action surrounding Ashland Global Holdings Inc.. (NYSE:ASH).
What have hedge funds been doing with Ashland Global Holdings Inc.. (NYSE:ASH)?
Heading into the first quarter of 2019, a total of 37 of the hedge funds tracked by Insider Monkey were long this stock, a change of 16% from one quarter earlier. On the other hand, there were a total of 34 hedge funds with a bullish position in ASH a year ago. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Ashland Global Holdings Inc.. (NYSE:ASH) was held by Luminus Management, which reported holding $218.8 million worth of stock at the end of September. It was followed by OZ Management with a $149 million position. Other investors bullish on the company included Cruiser Capital Advisors, Empyrean Capital Partners, and York Capital Management.
Now, key hedge funds have been driving this bullishness. Select Equity Group, managed by Robert Joseph Caruso, assembled the most valuable position in Ashland Global Holdings Inc.. (NYSE:ASH). Select Equity Group had $46.1 million invested in the company at the end of the quarter. Joel Greenblatt's Gotham Asset Management also initiated a $12.2 million position during the quarter. The other funds with brand new ASH positions are Javier Velazquez's Albar Capital, Brad Farber's Atika Capital, and Stephen Loukas, David A. Lorber, Zachary George's FrontFour Capital Group.
Let's go over hedge fund activity in other stocks similar to Ashland Global Holdings Inc.. (NYSE:ASH). We will take a look at Universal Display Corporation (NASDAQ:OLED), Brixmor Property Group Inc (NYSE:BRX), National Fuel Gas Company (NYSE:NFG), and Quanta Services Inc (NYSE:PWR). This group of stocks' market values are similar to ASH's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position OLED,10,80618,-10 BRX,17,321828,-1 NFG,16,216607,0 PWR,27,477082,-7 Average,17.5,274034,-4.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.5 hedge funds with bullish positions and the average amount invested in these stocks was $274 million. That figure was $1143 million in ASH's case. Quanta Services Inc (NYSE:PWR) is the most popular stock in this table. On the other hand Universal Display Corporation (NASDAQ:OLED) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Ashland Global Holdings Inc.. (NYSE:ASH) is more popular among hedge funds. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately ASH wasn't nearly as popular as these 15 stock and hedge funds that were betting on ASH were disappointed as the stock returned 10.4% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.