Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 817 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Lakeland Industries, Inc. (NASDAQ:LAKE) in this article.
Is Lakeland Industries, Inc. (NASDAQ:LAKE) an exceptional stock to buy now? The best stock pickers were in a bearish mood. The number of long hedge fund bets went down by 2 recently. Lakeland Industries, Inc. (NASDAQ:LAKE) was in 12 hedge funds' portfolios at the end of September. The all time high for this statistics is 14. Our calculations also showed that LAKE 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). There were 14 hedge funds in our database with LAKE holdings at the end of June.
Video: Watch our video about the top 5 most popular hedge fund stocks.
To the average investor there are dozens of methods stock market investors have at their disposal to size up their holdings. Some of the most underrated methods are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the top picks of the top money managers can beat their index-focused peers by a healthy amount (see the details here).
Louis Navellier of Navellier & Associates
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. Keeping this in mind we're going to take a glance at the fresh hedge fund action regarding Lakeland Industries, Inc. (NASDAQ:LAKE).
Do Hedge Funds Think LAKE Is A Good Stock To Buy Now?
At the end of September, a total of 12 of the hedge funds tracked by Insider Monkey were long this stock, a change of -14% from one quarter earlier. On the other hand, there were a total of 4 hedge funds with a bullish position in LAKE a year ago. With the smart money's capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
The largest stake in Lakeland Industries, Inc. (NASDAQ:LAKE) was held by Renaissance Technologies, which reported holding $12.8 million worth of stock at the end of September. It was followed by GLG Partners with a $6 million position. Other investors bullish on the company included Ariel Investments, Arrowstreet Capital, and OZ Management. In terms of the portfolio weights assigned to each position Navellier & Associates allocated the biggest weight to Lakeland Industries, Inc. (NASDAQ:LAKE), around 0.07% of its 13F portfolio. Ariel Investments is also relatively very bullish on the stock, designating 0.05 percent of its 13F equity portfolio to LAKE.
Judging by the fact that Lakeland Industries, Inc. (NASDAQ:LAKE) has witnessed a decline in interest from the entirety of the hedge funds we track, it's safe to say that there were a few money managers who were dropping their full holdings heading into Q4. Interestingly, Doug Gordon, Jon Hilsabeck and Don Jabro's Shellback Capital cut the biggest stake of the 750 funds tracked by Insider Monkey, totaling close to $3.3 million in stock. David Harding's fund, Winton Capital Management, also said goodbye to its stock, about $1.7 million worth. These transactions are important to note, as total hedge fund interest dropped by 2 funds heading into Q4.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Lakeland Industries, Inc. (NASDAQ:LAKE) but similarly valued. These stocks are InnerWorkings, Inc. (NASDAQ:INWK), Consolidated Water Co. Ltd. (NASDAQ:CWCO), First Choice Bancorp (NASDAQ:FCBP), CRH Medical Corporation (NYSE:CRHM), Zosano Pharma Corp (NASDAQ:ZSAN), Chimerix Inc (NASDAQ:CMRX), and Central Valley Community Bancorp (NASDAQ:CVCY). All of these stocks' market caps are similar to LAKE's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position INWK,14,14937,1 CWCO,8,12141,-1 FCBP,2,479,1 CRHM,6,20423,-1 ZSAN,5,3474,2 CMRX,14,27330,1 CVCY,3,3500,-2 Average,7.4,11755,0.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 7.4 hedge funds with bullish positions and the average amount invested in these stocks was $12 million. That figure was $30 million in LAKE's case. InnerWorkings, Inc. (NASDAQ:INWK) is the most popular stock in this table. On the other hand First Choice Bancorp (NASDAQ:FCBP) is the least popular one with only 2 bullish hedge fund positions. Lakeland Industries, Inc. (NASDAQ:LAKE) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LAKE is 70.4. 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. This is a slightly positive signal but 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 32.9% in 2020 through December 8th and beat the market again by 16.2 percentage points. Unfortunately LAKE wasn't nearly as popular as these 20 stocks and hedge funds that were betting on LAKE were disappointed as the stock returned 8% since the end of September (through 12/8) 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 many of these stocks already outperformed the market so far this year.
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Disclosure: None. This article was originally published at Insider Monkey.