Where Do Hedge Funds Stand On Alpha Pro Tech, Ltd. (APT)?
After several tireless days we have finished crunching the numbers from nearly 817 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Alpha Pro Tech, Ltd. (NYSE:APT).
Alpha Pro Tech, Ltd. (NYSE:APT) shareholders have witnessed a decrease in support from the world's most elite money managers of late. Alpha Pro Tech, Ltd. (NYSE:APT) was in 6 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistics is 8. Our calculations also showed that APT 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.
Today there are many indicators shareholders can use to appraise stocks. A pair of the less known indicators are hedge fund and insider trading interest. We have shown that, historically, those who follow the best picks of the top fund managers can trounce the S&P 500 by a superb margin (see the details here).
Michael Gelband of ExodusPoint Capital
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. With all of this in mind we're going to take a look at the latest hedge fund action encompassing Alpha Pro Tech, Ltd. (NYSE:APT).
Hedge fund activity in Alpha Pro Tech, Ltd. (NYSE:APT)
At the end of the third quarter, a total of 6 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -25% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in APT over the last 21 quarters. With hedge funds' capital changing hands, there exists an "upper tier" of key hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Alpha Pro Tech, Ltd. (NYSE:APT), which was worth $13.4 million at the end of the third quarter. On the second spot was Arrowstreet Capital which amassed $5 million worth of shares. Winton Capital Management, AQR Capital Management, and Citadel Investment Group were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Winton Capital Management allocated the biggest weight to Alpha Pro Tech, Ltd. (NYSE:APT), around 0.09% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to APT.
Judging by the fact that Alpha Pro Tech, Ltd. (NYSE:APT) has faced declining sentiment from hedge fund managers, it's easy to see that there were a few fund managers that elected to cut their full holdings last quarter. Interestingly, Daniel S. Och's OZ Management dropped the largest stake of all the hedgies followed by Insider Monkey, comprising close to $1.5 million in stock. Israel Englander's fund, Millennium Management, also said goodbye to its stock, about $0.3 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 2 funds last quarter.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Alpha Pro Tech, Ltd. (NYSE:APT) but similarly valued. These stocks are AquaBounty Technologies, Inc. (NASDAQ:AQB), ESSA Pharma Inc. (NASDAQ:EPIX), Verrica Pharmaceuticals Inc. (NASDAQ:VRCA), Soleno Therapeutics, Inc. (NASDAQ:SLNO), Hovnanian Enterprises, Inc. (NYSE:HOV), Medicenna Therapeutics Corp. (NASDAQ:MDNA), and Norwood Financial Corp. (NASDAQ:NWFL). All of these stocks' market caps match APT's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position AQB,4,1751,0 EPIX,16,72217,9 VRCA,4,41016,1 SLNO,13,45710,-2 HOV,8,27186,-1 MDNA,2,1975,2 NWFL,2,1813,0 Average,7,27381,1.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $27 million. That figure was $24 million in APT's case. ESSA Pharma Inc. (NASDAQ:EPIX) is the most popular stock in this table. On the other hand Medicenna Therapeutics Corp. (NASDAQ:MDNA) is the least popular one with only 2 bullish hedge fund positions. Alpha Pro Tech, Ltd. (NYSE:APT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for APT is 39.8. 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. 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 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 surpassed the market again by 16.1 percentage points. Unfortunately APT wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); APT investors were disappointed as the stock returned -18.9% since the end of September (through 11/27) 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 most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.
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