Should You Add One Liberty Properties, Inc. (OLP) to Your Portfolio?

You probably know from experience that there is not as much information on small-cap companies as there is on large companies. Of course, this makes it really hard and difficult for individual investors to make proper and accurate analysis of certain small-cap companies. However, well-known and successful hedge fund investors like Carl Icahn and George Soros hold the necessary resources and abilities to conduct an extensive stock analysis on small-cap stocks, which enable them to make millions of dollars by identifying potential winners within the small-cap galaxy of stocks. This represents the main reason why Insider Monkey takes notice of the hedge fund activity in these overlooked stocks.

One stock that registered a slight increase in confidence from smart money investors last quarter is One Liberty Properties, Inc. (NYSE:OLP). At the end of September, seven funds from our database held shares of OLP. 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 Mesa Laboratories, Inc. (NASDAQ:MLAB), Ryerson Holding Corp (NYSE:RYI), and Daktronics, Inc. (NASDAQ:DAKT) to gather more data points.

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.

Now, let’s check out the recent action regarding One Liberty Properties, Inc. (NYSE:OLP).

Hedge fund activity in One Liberty Properties, Inc. (NYSE:OLP)

At Q3’s end, seven funds tracked by Insider Monkey held long positions in this stock, up by one fund from the second quarter of 2016. Below, you can check out the change in hedge fund sentiment towards OLP over the last 5 quarters. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Renaissance Technologies, one of the largest hedge funds in the world, holds the biggest position in One Liberty Properties, Inc. (NYSE:OLP). Renaissance Technologies has a $10.1 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second largest stake is held by Israel Englander’s Millennium Management holding a $1.5 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other hedge funds and institutional investors that hold long positions consist of John Overdeck and David Siegel’s Two Sigma Advisors, D. E. Shaw’s D E Shaw and Thomas Bailard’s Bailard Inc. 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.

As industrywide interest jumped, key money managers were leading the bulls’ herd. Citadel Investment Group, led by Ken Griffin, initiated the most valuable position in One Liberty Properties, Inc. (NYSE:OLP). Citadel Investment Group had $0.2 million invested in the company at the end of the quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as One Liberty Properties, Inc. (NYSE:OLP) but similarly valued. We will take a look at Mesa Laboratories, Inc. (NASDAQ:MLAB), Ryerson Holding Corp (NYSE:RYI), Daktronics, Inc. (NASDAQ:DAKT), and China Online Education Group (NASDAQ:COE). This group of stocks’ market valuations are closest to OLP’s market valuation.

As you can see these stocks had an average of 10 funds with bullish positions and the average amount invested in these stocks was $28 million. That figure was $14 million in OLP’s case. Ryerson Holding Corp (NYSE:RYI) and Daktronics, Inc. (NASDAQ:DAKT) are the most popular stocks in this table. On the other hand Mesa Laboratories, Inc. (NASDAQ:MLAB) and China Online Education Group (NASDAQ:COE) are the least popular with only five bullish hedge fund positions. One Liberty Properties, Inc. (NYSE:OLP) 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 RYI might be a better candidate to consider taking a long position in.

Disclosure: none