Hedge fund managers like David Einhorn, Dan Loeb, or Carl Icahn became billionaires through reaping large profits for their investors, which is why piggybacking their stock picks may provide us with significant returns as well. Many hedge funds, like Paul Singer’s Elliott Management, are pretty secretive, but we can still get some insights by analyzing their quarterly 13F filings. One of the most fertile grounds for large abnormal returns is hedge funds’ most popular small-cap picks, which are not so widely followed and often trade at a discount to their intrinsic value. In this article we will check out hedge fund activity in another small-cap stock: Lifetime Brands Inc (NASDAQ:LCUT).
Lifetime Brands Inc (NASDAQ:LCUT) was in 4 hedge funds’ portfolios at the end of the third quarter of 2015. Lifetime Brands Inc (NASDAQ:LCUT) has experienced a decrease in activity from the world’s largest hedge funds of late. There were 8 hedge funds in our database with Lifetime Brands Inc (NASDAQ:LCUT) holdings at the end of the previous quarter. At the end of this article we will also compare Lifetime Brands Inc (NASDAQ:LCUT) to other stocks including Medgenics Inc (NYSEMKT:MDGN), JAKKS Pacific, Inc. (NASDAQ:JAKK), and Calamos Asset Management, Inc (NASDAQ:CLMS) to get a better sense of its popularity.
In the 21st century investor’s toolkit there are many metrics stock traders can use to size up their stock investments. A pair of the most innovative metrics are hedge fund and insider trading signals. we have shown that, historically, those who follow the top picks of the elite fund managers can outperform the broader indices by a significant margin (see the details here).
With all of this in mind, we’re going to take a glance at the fresh action regarding Lifetime Brands Inc (NASDAQ:LCUT).
Hedge fund activity in Lifetime Brands Inc (NASDAQ:LCUT)
At the end of third quarter, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 50% from the previous quarter. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Thomas E. Lynch’s Mill Road Capital Management had the number one position in Lifetime Brands Inc (NASDAQ:LCUT), worth close to $19.2 million, amounting to 38.6% of its total 13F portfolio. Coming in second is Royce & Associates, mutual fund managed by Chuck Royce, which held a $1.8 million position; less than 0.1% of its 13F portfolio is allocated to the company. Some other hedgies with similar optimism encompass Charles Paquelet’s Skylands Capital, Renaissance Technologies.
Seeing as Lifetime Brands Inc (NASDAQ:LCUT) has experienced a declination in interest from the entirety of the hedge funds we track, we can see that there was a specific group of hedge funds that slashed their positions entirely at the end of the third quarter. At the top of the heap, Ken Gray and Steve Walsh’s Bryn Mawr Capital sold off the largest stake of all the hedgies monitored by Insider Monkey, totaling about $0.5 million in stock, and Mark Coe of Coe Capital Management was right behind this move, as the fund dropped about $0.4 million worth. These moves are interesting, as total hedge fund interest was cut by 4 funds at the end of the third quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Lifetime Brands Inc (NASDAQ:LCUT) but similarly valued. These stocks are Medgenics Inc (NYSEMKT:MDGN), JAKKS Pacific, Inc. (NASDAQ:JAKK), Calamos Asset Management, Inc (NASDAQ:CLMS), and Medley Management Inc (NYSE:MDLY). This group of stocks’ market valuations match Lifetime Brands Inc (NASDAQ:LCUT)’s market valuation.
|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 9 hedge funds with bullish positions and the average amount invested in these stocks was $19 million. That figure was $24 millions in Lifetime Brands Inc (NASDAQ:LCUT)’s case. JAKKS Pacific, Inc. (NASDAQ:JAKK) is the most popular stock in this table. On the other hand, Medley Management Inc (NYSE:MDLY) is the least popular one with only four bullish hedge fund positions. Compared to these stocks Lifetime Brands Inc (NASDAQ:LCUT) is less popular and it registered a larger decline in the number of funds with long positions, which could suggest that the stock may not be the best choice for one’s portfolio at the moment.