Is Bel Fuse, Inc. (NASDAQ:BELFB) a good stock to buy right now? We at Insider Monkey like to examine what billionaires and hedge funds think of a company before doing days of research on it. Given their 2-and-20 payment structure, hedge funds have more resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also have numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform poorly at times, but their consensus picks have historically outperformed the market after risk adjustments.
Bel Fuse, Inc. (NASDAQ:BELFB) investors should pay attention to an increase in enthusiasm from smart money recently. Bel Fuse, Inc. (NASDAQ:BELFB) was in 11 hedge funds’ portfolios at the end of September. There were 7 hedge funds in our database with Bel Fuse, Inc. (NASDAQ:BELFB) holdings at the end of the previous quarter. 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 Independence Realty Trust Inc (NYSEMKT:IRT), Safe Bulkers, Inc. (NYSE:SB), and Big 5 Sporting Goods Corporation (NASDAQ:BGFV) to gather more data points.
To the average investor, there are many indicators market participants use to appraise their stock investments. Two of the most underrated indicators are hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the top picks of the top investment managers can beat their index-focused peers by a superb margin (see the details here).
With all of this in mind, let’s review the new action regarding Bel Fuse, Inc. (NASDAQ:BELFB).
How have hedgies been trading Bel Fuse, Inc. (NASDAQ:BELFB)?
At the end of the third quarter, a total of 11 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 57% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their stakes substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Renaissance Technologies holds the largest position in Bel Fuse, Inc. (NASDAQ:BELFB). Renaissance Technologies has a $3.7 million position in the stock, comprising less than 0.1% of its 13F portfolio. On Renaissance Technologies’ heels is J. Carlo Cannell of Cannell Capital, with a $2.3 million position; 0.9% of his fund’s 13F portfolio is allocated to the stock. Hedge funds and other institutional investors with similar optimism encompass Chuck Royce’s mutual fund, Royce & Associates, Millennium Management Subsidiary’s Green Arrow Capital Management, and Phil Frohlich’s Prescott Group Capital Management.
With general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Peter Algert and Kevin Coldiron’s Algert Coldiron Investors made a $0.3 million investment in the stock during the quarter. The following funds were also among the new Bel Fuse investors: Chao Ku’s Nine Chapters Capital Management, and Dmitry Balyasny’s Balyasny Asset Management.
Let’s now review hedge fund activity in other stocks similar to Bel Fuse, Inc. (NASDAQ:BELFB). We will take a look at Independence Realty Trust Inc (NYSEMKT:IRT), Safe Bulkers, Inc. (NYSE:SB), Big 5 Sporting Goods Corporation (NASDAQ:BGFV), and Furmanite Corporation (NYSE:FRM). This group of stocks’ market caps is similar to Bel Fuse, Inc. (NASDAQ:BELFB)’s market cap.
|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 11 hedge funds with bullish positions and the average amount invested in these stocks was $48 million. That figure was $14 million in Bel Fuse, Inc. (NASDAQ:BELFB)’s case. Big 5 Sporting Goods Corporation (NASDAQ:BGFV) is the most popular stock in this table. On the other hand, Safe Bulkers, Inc. (NYSE:SB) is the least popular one with only 6 bullish hedge fund positions. Bel Fuse, Inc. (NASDAQ:BELFB) 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 Big 5 Sporting Goods Corporation (NASDAQ:BGFV) and Furmanite Corporation (NYSE:FRM) might be better candidates to consider, though the rising sentiment in Bel Fuse is worth watching in the future.