We started seeing tectonic shifts in the market during the third quarter. Small-cap stocks underperformed the large-cap stocks by more than 10 percentage points between the end of June 2015 and the end of June 2016. A mean reversion in trends bumped small-cap stocks’ return to almost 9% in Q3, outperforming their large-cap peers by 5 percentage points. The momentum in small-cap space hasn’t subsided during this quarter either. Small-cap stocks beat large-cap stocks by another 5 percentage points during the first 7 weeks of this quarter. Hedge funds and institutional investors tracked by Insider Monkey usually invest a disproportionate amount of their portfolios in smaller cap stocks. We have been receiving indications that hedge funds were boosting their overall exposure and this is one of the factors behind the recent movements in major indices. In this article, we will take a closer look at hedge fund sentiment towards Masco Corp (NYSE:MAS).
Masco Corp (NYSE:MAS) has seen an increase in hedge fund sentiment in recent months. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Whole Foods Market, Inc. (NASDAQ:WFM), Ball Corporation (NYSE:BLL), and Annaly Capital Management, Inc. (NYSE:NLY) to gather more data points.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
With all of this in mind, let’s review the latest action encompassing Masco Corp (NYSE:MAS).
What does the smart money think about Masco Corp (NYSE:MAS)?
At Q3’s end, a total of 38 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 15% from the second quarter of 2016. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
Of the funds tracked by Insider Monkey, AQR Capital Management, managed by Cliff Asness, holds the biggest position in Masco Corp (NYSE:MAS). AQR Capital Management has a $199 million position in the stock, comprising 0.3% of its 13F portfolio. On AQR Capital Management’s heels is Columbus Circle Investors, led by Principal Global Investors, holding a $153.4 million position; the fund has 1.7% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish contain David Cohen and Harold Levy’s Iridian Asset Management, D. E. Shaw’s D E Shaw and Israel Englander’s Millennium Management.