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The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards YPF Sociedad Anonima (NYSE:YPF).
Is YPF Sociedad Anonima (NYSE:YPF) a buy right now? Prominent investors are becoming hopeful. The number of long hedge fund bets advanced by 3 lately. Our calculations also showed that YPF isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 91% since May 2014 and outperformed the Russell 2000 ETFs by nearly 40 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
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Howard Marks of Oaktree Capital Management[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world's largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, "I'm investing more today than I did back in early 2009." So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds' buy/sell signals. Let's take a gander at the latest hedge fund action regarding YPF Sociedad Anonima (NYSE:YPF).
How have hedgies been trading YPF Sociedad Anonima (NYSE:YPF)?
At the end of the third quarter, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 20% from the second quarter of 2019. By comparison, 17 hedge funds held shares or bullish call options in YPF a year ago. With the smart money's capital changing hands, there exists an "upper tier" of notable hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).
Among these funds, Canyon Capital Advisors held the most valuable stake in YPF Sociedad Anonima (NYSE:YPF), which was worth $26.3 million at the end of the third quarter. On the second spot was Luminus Management which amassed $24 million worth of shares. Oaktree Capital Management, Redwood Capital Management, and Renaissance Technologies 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 Marathon Asset Management allocated the biggest weight to YPF Sociedad Anonima (NYSE:YPF), around 1.37% of its 13F portfolio. Redwood Capital Management is also relatively very bullish on the stock, designating 0.89 percent of its 13F equity portfolio to YPF.
Now, specific money managers were breaking ground themselves. Luminus Management, managed by Jonathan Barrett and Paul Segal, assembled the most outsized position in YPF Sociedad Anonima (NYSE:YPF). Luminus Management had $24 million invested in the company at the end of the quarter. Howard Marks's Oaktree Capital Management also initiated a $13.3 million position during the quarter. The other funds with brand new YPF positions are Renaissance Technologies, Bruce J. Richards and Louis Hanover's Marathon Asset Management, and Matt Smith's Deep Basin Capital.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as YPF Sociedad Anonima (NYSE:YPF) but similarly valued. These stocks are Pebblebrook Hotel Trust (NYSE:PEB), Exponent, Inc. (NASDAQ:EXPO), J & J Snack Foods Corp. (NASDAQ:JJSF), and Umpqua Holdings Corporation (NASDAQ:UMPQ). This group of stocks' market values are similar to YPF's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PEB,12,104562,-1 EXPO,18,115116,3 JJSF,17,132052,4 UMPQ,20,140686,0 Average,16.75,123104,1.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.75 hedge funds with bullish positions and the average amount invested in these stocks was $123 million. That figure was $100 million in YPF's case. Umpqua Holdings Corporation (NASDAQ:UMPQ) is the most popular stock in this table. On the other hand Pebblebrook Hotel Trust (NYSE:PEB) is the least popular one with only 12 bullish hedge fund positions. YPF Sociedad Anonima (NYSE:YPF) is not the most popular stock in this group but hedge fund interest is still above average. 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 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately YPF wasn't nearly as popular as these 20 stocks and hedge funds that were betting on YPF were disappointed as the stock returned 3.9% during the fourth quarter (through the end of November) 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.
Disclosure: None. This article was originally published at Insider Monkey.