Reputable billionaire investors such as Jim Simons, Cliff Asness and David Tepper generate exorbitant profits for their wealthy accredited investors (a minimum of $1 million in investable assets would be required to invest in a hedge fund and most successful hedge funds won't accept your savings unless you commit at least $5 million) by pinpointing winning small-cap stocks. There is little or no publicly-available information at all on some of these small companies, which makes it hard for an individual investor to pin down a winner within the small-cap space. However, hedge funds and other big asset managers can do the due diligence and analysis for you instead, thanks to their highly-skilled research teams and vast resources to conduct an appropriate evaluation process. Looking for potential winners within the small-cap galaxy of stocks? We believe following the smart money is a good starting point.
Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) was in 11 hedge funds' portfolios at the end of the first quarter of 2019. CCO investors should be aware of a decrease in hedge fund sentiment in recent months. There were 13 hedge funds in our database with CCO positions at the end of the previous quarter. Our calculations also showed that cco isn't among the 30 most popular stocks among hedge funds.
To the average investor there are numerous formulas stock traders put to use to assess stocks. A duo of the most underrated formulas are hedge fund and insider trading moves. Our experts have shown that, historically, those who follow the best picks of the elite money managers can outclass the S&P 500 by a superb amount (see the details here).
Let's take a look at the new hedge fund action surrounding Clear Channel Outdoor Holdings, Inc. (NYSE:CCO).
What does smart money think about Clear Channel Outdoor Holdings, Inc. (NYSE:CCO)?
At the end of the first quarter, a total of 11 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -15% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in CCO over the last 15 quarters. With the smart money's positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, John M. Angelo and Michael L. Gordon's Angelo Gordon & Co has the biggest position in Clear Channel Outdoor Holdings, Inc. (NYSE:CCO), worth close to $19.9 million, comprising 1.9% of its total 13F portfolio. Coming in second is David Abrams of Abrams Capital Management, with a $17.9 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other peers that hold long positions encompass Mario Gabelli's GAMCO Investors, Joshua Friedman and Mitchell Julis's Canyon Capital Advisors and Jim Simons's Renaissance Technologies.
Because Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) has experienced a decline in interest from the entirety of the hedge funds we track, logic holds that there exists a select few hedgies who were dropping their full holdings last quarter. Interestingly, Ken Griffin's Citadel Investment Group sold off the largest stake of the 700 funds followed by Insider Monkey, worth about $0.1 million in stock, and Paul Tudor Jones's Tudor Investment Corp was right behind this move, as the fund said goodbye to about $0.1 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 2 funds last quarter.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) but similarly valued. These stocks are USANA Health Sciences, Inc. (NYSE:USNA), Insight Enterprises, Inc. (NASDAQ:NSIT), Taylor Morrison Home Corp (NYSE:TMHC), and Atlantica Yield plc (NASDAQ:AY). This group of stocks' market valuations are closest to CCO's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position USNA,22,313412,3 NSIT,17,119442,-4 TMHC,12,184668,-3 AY,21,239050,-1 Average,18,214143,-1.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $214 million. That figure was $72 million in CCO's case. USANA Health Sciences, Inc. (NYSE:USNA) is the most popular stock in this table. On the other hand Taylor Morrison Home Corp (NYSE:TMHC) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) is even less popular than TMHC. Hedge funds dodged a bullet by taking a bearish stance towards CCO. Our calculations showed that the top 20 most popular hedge fund stocks returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately CCO wasn't nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); CCO investors were disappointed as the stock returned -6.2% during the same time frame 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 13 of these stocks already outperformed the market so far in the second quarter.
Disclosure: None. This article was originally published at Insider Monkey.