AptarGroup, Inc. (ATR): Hedge Fund Sentiment Unchanged

As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the fourth quarter of 2019. A significant number of hedge funds continued their strong performance in 2020 and 2021 as well. We get to see hedge funds’ thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about AptarGroup, Inc. (NYSE:ATR).

Hedge fund interest in AptarGroup, Inc. (NYSE:ATR) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that ATR isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). 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 Deckers Outdoor Corp (NYSE:DECK), Jazz Pharmaceuticals Plc (NASDAQ:JAZZ), and First Solar, Inc. (NASDAQ:FSLR) to gather more data points.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Tim Woolley of Polar Capital

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. With all of this in mind let’s take a look at the latest hedge fund action surrounding AptarGroup, Inc. (NYSE:ATR).

Do Hedge Funds Think ATR Is A Good Stock To Buy Now?

At Q1’s end, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the previous quarter. On the other hand, there were a total of 20 hedge funds with a bullish position in ATR a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Rivulet Capital was the largest shareholder of AptarGroup, Inc. (NYSE:ATR), with a stake worth $143.1 million reported as of the end of March. Trailing Rivulet Capital was Polar Capital, which amassed a stake valued at $67.8 million. Royce & Associates, Citadel Investment Group, and GLG Partners were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Rivulet Capital allocated the biggest weight to AptarGroup, Inc. (NYSE:ATR), around 7.76% of its 13F portfolio. Polar Capital is also relatively very bullish on the stock, designating 0.42 percent of its 13F equity portfolio to ATR.

Judging by the fact that AptarGroup, Inc. (NYSE:ATR) has witnessed a decline in interest from the entirety of the hedge funds we track, we can see that there was a specific group of hedge funds that decided to sell off their full holdings by the end of the first quarter. It’s worth mentioning that Israel Englander’s Millennium Management sold off the biggest investment of the “upper crust” of funds tracked by Insider Monkey, totaling close to $22.8 million in stock, and Steve Cohen’s Point72 Asset Management was right behind this move, as the fund said goodbye to about $13.7 million worth. These transactions are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as AptarGroup, Inc. (NYSE:ATR) but similarly valued. We will take a look at Deckers Outdoor Corp (NYSE:DECK), Jazz Pharmaceuticals Plc (NASDAQ:JAZZ), First Solar, Inc. (NASDAQ:FSLR), Pegasystems Inc. (NASDAQ:PEGA), Companhia Siderurgica Nacional (NYSE:SID), WEX Inc (NYSE:WEX), and NRG Energy Inc (NYSE:NRG). This group of stocks’ market caps resemble ATR’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DECK 40 922422 -5
JAZZ 37 1260492 8
FSLR 24 304351 -10
PEGA 35 1728264 3
SID 10 60938 1
WEX 26 538269 0
NRG 35 1606143 4
Average 29.6 917268 0.1

View table here if you experience formatting issues.

As you can see these stocks had an average of 29.6 hedge funds with bullish positions and the average amount invested in these stocks was $917 million. That figure was $260 million in ATR’s case. Deckers Outdoor Corp (NYSE:DECK) is the most popular stock in this table. On the other hand Companhia Siderurgica Nacional (NYSE:SID) is the least popular one with only 10 bullish hedge fund positions. AptarGroup, Inc. (NYSE:ATR) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ATR is 43.1. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately ATR wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); ATR investors were disappointed as the stock returned -1.6% since the end of March (through 7/16) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.

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Disclosure: None. This article was originally published at Insider Monkey.