At Insider Monkey, we pore over the filings of more than 700 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of September 30. In this article, we will use that wealth of knowledge to determine whether or not Dorian LPG Ltd (NYSE:LPG) makes for a good investment right now.
Is Dorian LPG Ltd (NYSE:LPG) the right pick for your portfolio? The smart money is becoming less hopeful. The number of bullish hedge fund positions dropped by 7 in recent months.
In the eyes of most investors, hedge funds are viewed as slow, outdated investment tools of yesteryear. While there are over 8000 funds with their doors open today, Hedge fund experts at Insider Monkey look at the aristocrats of this group, around 700 funds. These money managers preside over most of all hedge funds’ total capital, and by tracking their top stock picks, Insider Monkey has figured out a few investment strategies that have historically defeated Mr. Market. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, we’re going to check out the recent action regarding Dorian LPG Ltd (NYSE:LPG).
How are hedge funds trading Dorian LPG Ltd (NYSE:LPG)?
At the end of September, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 39% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully.
According to hedge fund experts at Insider Monkey, Kensico Capital, managed by Michael Lowenstein, holds the most valuable position in Dorian LPG Ltd (NYSE:LPG). Kensico Capital has a $82.6 million position in the stock, comprising 1.7% of its 13F portfolio. On Kensico Capital’s heels is Paul Orlin and Alex Porter of Amici Capital, with a $31.6 million position; 1.5% of its 13F portfolio is allocated to the company. Other peers with similar optimism include Gifford Combs’s Dalton Investments, Patrik Brummer’s Zenit Asset Management AB and Christopher Pucillo’s Solus Alternative Asset Management.
Seeing as Dorian LPG Ltd (NYSE:LPG) has witnessed falling interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of hedge funds that elected to cut their full holdings last quarter. Intriguingly, Israel Englander’s Millennium Management dumped the largest stake of the “upper crust” of funds monitored by Insider Monkey, valued at an estimated $4.8 million in stock, and Thomas Steyer of Farallon Capital was right behind this move, as the fund said goodbye to about $2.6 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 7 funds last quarter.
Let’s also examine hedge fund activity in other stocks similar to Dorian LPG Ltd (NYSE:LPG). These stocks are Ellington Financial LLC (NYSE:EFC), Capella Education Company (NASDAQ:CPLA), Aegion Corp – Class A (NASDAQ:AEGN), and PGT, Inc. (NASDAQ:PGTI). This group of stocks’ market values are similar to LPG’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $76 million. Aegion Corp – Class A (NASDAQ:AEGN) is the most popular stock in this table. Dorian LPG Ltd (NYSE:LPG)’s popularity is average, but the company witnessed a more significant weakening in sentiment than most of the companies in the table. This could suggest that LPG may require more caution if it is already in your portfolio and a more detailed analysis if you are considering taking a long position.