Is Raven Industries, Inc. (RAVN) A Buy After Landing Defense Contract?

Hedge fund activity in Raven Industries, Inc. (NASDAQ:RAVN)

At the end of the first quarter, a total of 9 hedge funds held long positions in this stock, a change of 13% from the fourth quarter. Overall, aggregate invested capital by these hedge funds also increased by 3.6% from the fourth quarter. With hedgies’ showing a bullish outlook on the stock, some hedge fund managers opened new positions in the stock and a few others strengthened their positions in the stock.

According to Insider Monkey’s database, Royce & Associates, managed by Chuck Royce, holds the largest position in Raven Industries, Inc. (NASDAQ:RAVN). Royce & Associates holds 1.6 million shares valued at $32.7 million, comprising 0.12% of its 13F portfolio at the end of the first quarter. Coming in second is Jim Simons‘ Renaissance Technologies, with around 197,116 shares valued at $4 million at the end of the first quarter. The fund has less than 0.1% of its 13F portfolio invested in the stock. Other members of the smart money with similar optimism consist of Ken Griffin‘s Citadel Investment Group, and John Overdeck and David Siegel’s Two Sigma Advisors.

Consequently, some hedge fund names were leading the bulls’ herd by opening up fresh positions in the stock. Cove Street Capital, managed by Jeffrey Bronchick, initiated the largest position in Raven Industries, Inc. (NASDAQ:RAVN) in the first quarter. Cove Street Capital bought 63,300 shares valued at $1.3 million at the end of the first quarter. Donald Yacktman’s Yacktman Asset Management also initiated a $542,000 position during the quarter, buying 26,500 shares of the company. The only other fund with a brand new RAVN position is Paul Marshall and Ian Wace’s Marshall Wace LLP.

We see that insider sentiment is strongly positive for the stock, along with strong hedge fund sentiment and an 11% upside movement following positive news for the company. With all of these positive indicators, we recommend buying this stock.

Disclosure: None