Ashford Hospitality Trust, Inc. (AHT) Fell Out Of Favor With Hedge Funds

After several tireless days we have finished crunching the numbers from nearly 817 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Ashford Hospitality Trust, Inc. (NYSE:AHT).

Is Ashford Hospitality Trust, Inc. (NYSE:AHT) the right investment to pursue these days? The smart money was getting less bullish. The number of bullish hedge fund positions decreased by 10 recently. Ashford Hospitality Trust, Inc. (NYSE:AHT) was in 3 hedge funds’ portfolios at the end of September. The all time high for this statistics is 18. Our calculations also showed that AHT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

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Ken Griffin of Citadel Investment Group

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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 website. Keeping this in mind let’s check out the recent hedge fund action surrounding Ashford Hospitality Trust, Inc. (NYSE:AHT).

How are hedge funds trading Ashford Hospitality Trust, Inc. (NYSE:AHT)?

At the end of September, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -77% from the previous quarter. By comparison, 12 hedge funds held shares or bullish call options in AHT a year ago. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).

Among these funds, Renaissance Technologies held the most valuable stake in Ashford Hospitality Trust, Inc. (NYSE:AHT), which was worth $1.4 million at the end of the third quarter. On the second spot was Millennium Management which amassed $0.1 million worth of shares. Citadel Investment Group was 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 Renaissance Technologies allocated the biggest weight to Ashford Hospitality Trust, Inc. (NYSE:AHT), around 0.0014% of its 13F portfolio. Millennium Management is also relatively very bullish on the stock, earmarking 0.0001 percent of its 13F equity portfolio to AHT.

Due to the fact that Ashford Hospitality Trust, Inc. (NYSE:AHT) has faced falling interest from hedge fund managers, we can see that there were a few hedgies that decided to sell off their full holdings heading into Q4. Interestingly, Renaissance Technologies dumped the largest position of the 750 funds tracked by Insider Monkey, comprising an estimated $5.5 million in stock. Cliff Asness’s fund, AQR Capital Management, also sold off its stock, about $1.2 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest fell by 10 funds heading into Q4.

Let’s also examine hedge fund activity in other stocks similar to Ashford Hospitality Trust, Inc. (NYSE:AHT). We will take a look at AIkido Pharma Inc. (NASDAQ:AIKI), GSE Systems, Inc. (NASDAQ:GVP), Edison Nation, Inc. (NASDAQ:EDNT), Ra Medical Systems, Inc. (NYSE:RMED), Chicago Rivet & Machine Co. (NYSE:CVR), iFresh Inc. (NASDAQ:IFMK), and Eltek Ltd. (NASDAQ:ELTK). All of these stocks’ market caps are closest to AHT’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
AIKI 2 46 1
GVP 2 1303 -1
EDNT 1 59 0
RMED 3 1434 -1
CVR 2 1314 0
IFMK 1 10 0
ELTK 1 320 0
Average 1.7 641 -0.1

View table here if you experience formatting issues.

As you can see these stocks had an average of 1.7 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $1 million in AHT’s case. Ra Medical Systems, Inc. (NYSE:RMED) is the most popular stock in this table. On the other hand Edison Nation, Inc. (NASDAQ:EDNT) is the least popular one with only 1 bullish hedge fund positions. Ashford Hospitality Trust, Inc. (NYSE:AHT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for AHT is 50. 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. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. Hedge funds were also right about betting on AHT as the stock returned 121.8% since the end of Q3 (through 11/23) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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