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Is United Microelectronics Corp (ADR) (UMC) A Good Stock to Buy?

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Hedge funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow over 700 of the best-performing investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is United Microelectronics Corp (ADR) (NYSE:UMC), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

United Microelectronics Corp (ADR) (NYSE:UMC) was in 8 hedge funds’ portfolios at the end of the third quarter of 2016. UMC has experienced a decrease in hedge fund sentiment of late. There were 9 hedge funds in our database with UMC positions at the end of June. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as National Fuel Gas Co. (NYSE:NFG), Navient Corp (NASDAQ:NAVI), and Amtrust Financial Services, Inc. (NASDAQ:AFSI) to gather more data points.

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At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

everything possible/Shutterstock.com

everything possible/Shutterstock.com

How are hedge funds trading United Microelectronics Corp (ADR) (NYSE:UMC)?

Heading into the fourth quarter of 2016, a total of 8 of the hedge funds tracked by Insider Monkey were long this stock, a drop of 11% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards UMC over the last 5 quarters, which peaked at the end of March. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

UMC Chart

Of the funds tracked by Insider Monkey, Renaissance Technologies, one of the largest hedge funds in the world, has the most valuable position in United Microelectronics Corp (ADR) (NYSE:UMC), worth close to $14.9 million. Sitting at the No. 2 spot is Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital, with a $7.5 million position. Other professional money managers that hold long positions comprise Michael Hintze’s CQS Cayman LP, Israel Englander’s Millennium Management, and David E. Shaw’s D E Shaw. 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-micro-cap stocks.

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