Insider Monkey finished processing more than 700 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of December 31st, 2018. In this article we are going to take a look at smart money sentiment towards Prestige Consumer Healthcare Inc. (NYSE:PBH).
Is Prestige Consumer Healthcare Inc. (NYSE:PBH) a buy, sell, or hold? Hedge funds are becoming hopeful. The number of long hedge fund bets improved by 1 lately. Our calculations also showed that PBH isn't among the 30 most popular stocks among hedge funds. PBH was in 15 hedge funds' portfolios at the end of December. There were 14 hedge funds in our database with PBH positions at the end of the previous quarter.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were 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'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Let's take a look at the fresh hedge fund action regarding Prestige Consumer Healthcare Inc. (NYSE:PBH).
What have hedge funds been doing with Prestige Consumer Healthcare Inc. (NYSE:PBH)?
At the end of the fourth quarter, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of 7% from the second quarter of 2018. The graph below displays the number of hedge funds with bullish position in PBH over the last 14 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Prestige Consumer Healthcare Inc. (NYSE:PBH) was held by Fisher Asset Management, which reported holding $38.5 million worth of stock at the end of December. It was followed by GLG Partners with a $12 million position. Other investors bullish on the company included Citadel Investment Group, Millennium Management, and D E Shaw.
Now, some big names were breaking ground themselves. D E Shaw, managed by D. E. Shaw, assembled the largest position in Prestige Consumer Healthcare Inc. (NYSE:PBH). D E Shaw had $3.4 million invested in the company at the end of the quarter. Matthew Tewksbury's Stevens Capital Management also initiated a $1.4 million position during the quarter. The other funds with brand new PBH positions are Minhua Zhang's Weld Capital Management, Paul Marshall and Ian Wace's Marshall Wace LLP, and Gavin Saitowitz and Cisco J. del Valle's Springbok Capital.
Let's now review hedge fund activity in other stocks similar to Prestige Consumer Healthcare Inc. (NYSE:PBH). These stocks are Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD), Harsco Corporation (NYSE:HSC), Plexus Corp. (NASDAQ:PLXS), and Progress Software Corporation (NASDAQ:PRGS). This group of stocks' market values resemble PBH's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IRWD,17,306249,0 HSC,24,112545,2 PLXS,14,71897,2 PRGS,22,242639,-2 Average,19.25,183333,0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.25 hedge funds with bullish positions and the average amount invested in these stocks was $183 million. That figure was $73 million in PBH's case. Harsco Corporation (NYSE:HSC) is the most popular stock in this table. On the other hand Plexus Corp. (NASDAQ:PLXS) is the least popular one with only 14 bullish hedge fund positions. Prestige Consumer Healthcare Inc. (NYSE:PBH) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. 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 PBH wasn't nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); PBH investors were disappointed as the stock returned -8.3% 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.