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: Star Bulk Carriers Corp. (NASDAQ:SBLK).
Star Bulk Carriers Corp. (NASDAQ:SBLK) was in 6 hedge funds’ portfolios at the end of the third quarter of 2016. SBLK has experienced a decrease in support from the world’s most successful money managers in recent months. There were 7 hedge funds in our database with SBLK positions at the end of the previous quarter. At the end of this article we will also compare SBLK to other stocks including Tabula Rasa HealthCare Inc (NASDAQ:TRHC), Hill International Inc (NYSE:HIL), and Exa Corp (NASDAQ:EXA) to get a better sense of its popularity.
We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs. We launched this strategy 2.5 years ago and it returned more than 39% since then, vs. 22% gain registered by the S&P 500 ETFs.
Keeping this in mind, we’re going to check out the latest action surrounding Star Bulk Carriers Corp. (NASDAQ:SBLK).
What does the smart money think about Star Bulk Carriers Corp. (NASDAQ:SBLK)?
At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 14% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in SBLK over the last 5 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Of the funds tracked by Insider Monkey, Howard Marks’ Oaktree Capital Management has the number one position in Star Bulk Carriers Corp. (NASDAQ:SBLK), worth close to $132 million, comprising 1.7% of its total 13F portfolio. The second most bullish fund manager is Caspian Capital Partners, led by Mark Weissman, Adam Cohen and David Coleto, holding a $16.7 million position; 2.5% of its 13F portfolio is allocated to the company. Other peers that are bullish comprise Michael Weinstock’s Monarch Alternative Capital, Noam Gottesman’s GLG Partners and Millennium Management, one of the largest hedge funds in the world. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.