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Where Do Hedge Funds Stand On Calumet Specialty Products Partners (CLMT)?

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Debasis Saha
·6 min read
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The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 817 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of September 30th, about a month before the elections. In this article we look at what those investors think of Calumet Specialty Products Partners, L.P (NASDAQ:CLMT).

Hedge fund interest in Calumet Specialty Products Partners, L.P (NASDAQ:CLMT) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that CLMT 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). At the end of this article we will also compare CLMT to other stocks including Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), Plymouth Industrial REIT, Inc. (NYSE:PLYM), and Baytex Energy Corp (NYSE:BTE) to get a better sense of its popularity.

Video: Watch our video about the top 5 most popular hedge fund stocks.

According to most stock holders, hedge funds are viewed as unimportant, old financial tools of yesteryear. While there are over 8000 funds in operation at present, Our experts choose to focus on the bigwigs of this group, approximately 850 funds. It is estimated that this group of investors oversee bulk of all hedge funds' total capital, and by watching their finest investments, Insider Monkey has uncovered various investment strategies that have historically outstripped the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points a year 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 .

Michael Platt BlueCrest Capital
Michael Platt BlueCrest 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 10 most profitable companies in the world 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 let's review the fresh hedge fund action surrounding Calumet Specialty Products Partners, L.P (NASDAQ:CLMT).

How have hedgies been trading Calumet Specialty Products Partners, L.P (NASDAQ:CLMT)?

At Q3's end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the second quarter of 2020. Below, you can check out the change in hedge fund sentiment towards CLMT over the last 21 quarters. With the smart money's capital changing hands, there exists a few notable hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).

Is CLMT A Good Stock To Buy?
Is CLMT A Good Stock To Buy?

More specifically, Dorset Management was the largest shareholder of Calumet Specialty Products Partners, L.P (NASDAQ:CLMT), with a stake worth $5.2 million reported as of the end of September. Trailing Dorset Management was Springhouse Capital Management, which amassed a stake valued at $0.9 million. Citadel Investment Group was 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 Dorset Management allocated the biggest weight to Calumet Specialty Products Partners, L.P (NASDAQ:CLMT), around 3.02% of its 13F portfolio. Springhouse Capital Management is also relatively very bullish on the stock, designating 1.37 percent of its 13F equity portfolio to CLMT.

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren't any hedge funds dumping their holdings during the third quarter, there weren't any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven't identified any viable catalysts that can attract investor attention.

Let's now take a look at hedge fund activity in other stocks similar to Calumet Specialty Products Partners, L.P (NASDAQ:CLMT). We will take a look at Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), Plymouth Industrial REIT, Inc. (NYSE:PLYM), Baytex Energy Corp (NYSE:BTE), Tortoise Energy Infrastructure Corporation (NYSE:TYG), Farmland Partners Inc (NYSE:FPI), Vista Oil & Gas, S.A.B. de C.V. (NYSE:VIST), and Aduro BioTech Inc (NASDAQ:ADRO). This group of stocks' market values are closest to CLMT's market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ASPS,6,11283,-2 PLYM,14,35524,7 BTE,9,7132,3 TYG,2,1839,1 FPI,8,5154,0 VIST,9,31931,4 ADRO,9,36124,-2 Average,8.1,18427,1.6 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 8.1 hedge funds with bullish positions and the average amount invested in these stocks was $18 million. That figure was $7 million in CLMT's case. Plymouth Industrial REIT, Inc. (NYSE:PLYM) is the most popular stock in this table. On the other hand Tortoise Energy Infrastructure Corporation (NYSE:TYG) is the least popular one with only 2 bullish hedge fund positions. Calumet Specialty Products Partners, L.P (NASDAQ:CLMT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CLMT is 20.4. 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 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. A small number of hedge funds were also right about betting on CLMT as the stock returned 40.4% since the end of the third quarter (through 11/23) and outperformed the market by an even larger margin.

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Disclosure: None. This article was originally published at Insider Monkey.

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