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 Cardtronics, Inc. (NASDAQ:CATM) makes for a good investment right now.
Cardtronics, Inc. (NASDAQ:CATM) was in 16 hedge funds’ portfolios at the end of the third quarter of 2015 and has experienced an increase in hedge fund interest in recent months. There were 14 hedge funds in our database with CATM positions at the end of the previous quarter. At the end of this article we will also compare CATM to other stocks including Mattress Firm Holding Corp (NASDAQ:MFRM), Joy Global Inc. (NYSE:JOY), and Loral Space & Communications Ltd. (NASDAQ:LORL) to get a better sense of its popularity.
Follow Cardtronics Inc (NASDAQ:CATM)
Follow Cardtronics Inc (NASDAQ:CATM)
To the average investor, there are a lot of gauges market participants put to use to assess their holdings. A duo of the less known gauges are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the best picks of the best investment managers can outclass the S&P 500 by a healthy margin (see the details here).
Now, we’re going to review the recent action encompassing Cardtronics, Inc. (NASDAQ:CATM).
How are hedge funds trading Cardtronics, Inc. (NASDAQ:CATM)?
Heading into Q4, a total of 16 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 14% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Lee Munder Capital Group, managed by Lee Munder, holds the biggest position in Cardtronics, Inc. (NASDAQ:CATM). Lee Munder Capital Group has a $21.8 million position in the stock, comprising 0.5% of its 13F portfolio. Coming in second is Brian Taylor of Pine River Capital Management, with a $7 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions comprise Ken Griffin’s Citadel Investment Group, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Jim Simons’s Renaissance Technologies.
With a general bullishness amongst the heavyweights, some big names were leading the bulls’ herd. Renaissance Technologies initiated the most valuable position in Cardtronics, Inc. (NASDAQ:CATM), followed by Glenn Russell Dubin’s Highbridge Capital Management, which also made a $3.2 million investment in the stock during the quarter. The other funds with new positions in the stock are Nick Niell’s Arrowgrass Capital Partners, Neil Chriss’s Hutchin Hill Capital, and Dmitry Balyasny’s Balyasny Asset Management.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Cardtronics, Inc. (NASDAQ:CATM) but similarly valued. We will take a look at Mattress Firm Holding Corp (NASDAQ:MFRM), Joy Global Inc. (NYSE:JOY), Loral Space & Communications Ltd. (NASDAQ:LORL), and Abercrombie & Fitch Co. (NYSE:ANF). This group of stocks’ market valuations match CATM’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MFRM | 13 | 367789 | 3 |
| JOY | 28 | 254326 | 9 |
| LORL | 25 | 834056 | -3 |
| ANF | 22 | 168345 | 3 |
As you can see these stocks had an average of 22 hedge funds with bullish positions and the average amount invested in these stocks was $406 million. That figure was $57 million in CATM’s case. Joy Global Inc. (NYSE:JOY) is the most popular stock in this table with 28 long positions, while Mattress Firm Holding Corp (NASDAQ:MFRM) is the least popular one with only 13 bullish hedge fund positions. Cardtronics, Inc. (NASDAQ:CATM) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard JOY might be a better candidate to consider a long position.
