The equity market returns were very disappointing in the third quarter, “thanks” to the slowdown of China’s economy and the weaker-than-expected U.S. economic data. It was not entirely clear whether the broader market sell-off made U.S. equity valuations undervalued, but it definitely made them more attractive. It is worth mentioning that Russell 2000 ETF (IWM) underperformed the broad-market S&P 500 ETF by more than 14 percentage points during the period of June 25, 2015 through October 30, 2015. This clearly points to the fact that most investors, including hedge fund firms and institutional investors, heavily cut their exposure to high-potential (but seemingly riskier) small-cap stocks during the bloody third quarter. So let’s take a glance at the smart money sentiment towards Ameresco Inc (NYSE:AMRC) and see how it was affected.
Is Ameresco Inc (NYSE:AMRC) ready to rally soon? Money managers are in an optimistic mood. The number of long hedge fund positions increased by 1 recently. Ameresco Inc (NYSE:AMRC) was in 7 hedge funds’ portfolios at the end of the third quarter of 2015. There were 6 hedge funds in our database with Ameresco Inc (NYSE:AMRC) positions at the end of the previous quarter. What is even more surprising is the fact that the shares of the company fell in excess of 23% during the third quarter, prompting us to find out about the hedge funds holding positions in the company, at the end of September.
In order to understand the hedge fund behavior towards stocks with similar market caps, we will also compare Ameresco Inc (NYSE:AMRC) to other stocks including CTC Media, Inc. (NASDAQ:CTCM), Heritage Oaks Bancorp (NASDAQ:HEOP), and Northern Oil & Gas, Inc. (NYSEMKT:NOG) to get a better sense of its popularity.
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In today’s marketplace there are a large number of formulas stock traders have at their disposal to size up publicly traded companies. Some of the less known formulas are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the best picks of the best investment managers can trounce the broader indices by a significant margin (see the details here).
With all of this in mind, we’re going to take a peek at the new action encompassing Ameresco Inc (NYSE:AMRC).
How are hedge funds trading Ameresco Inc (NYSE:AMRC)?
At the end of September, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 17% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund and institutional investor database, Chuck Royce’s Royce & Associates has the biggest position in Ameresco Inc (NYSE:AMRC), worth close to $5.4 million, comprising less than 0.1% of its total 13F portfolio. Coming in second is John A. Levin of Levin Capital Strategies, with a $2.8 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions comprise Jos Shaver’s Electron Capital Partners, John Overdeck and David Siegel’s Two Sigma Advisors, and Israel Englander’s Millennium Management.