Companhia Siderurgica Nacional (ADR) (SID): Hedge Fund Sentiment Unchanged

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on Companhia Siderurgica Nacional (ADR) (NYSE:SID).

Hedge fund interest in Companhia Siderurgica Nacional (ADR) (NYSE:SID) shares was flat at the end of last quarter. This is usually a negative indicator. 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 CAE, Inc. (USA) (NYSE:CAE), Allied World Assurance Co Holdings, AG. (NYSE:AWH), and Prosperity Bancshares, Inc. (NYSE:PB) 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, we’re going to analyze the latest action encompassing Companhia Siderurgica Nacional (ADR) (NYSE:SID).

Hedge fund activity in Companhia Siderurgica Nacional (ADR) (NYSE:SID)

At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from the second quarter of 2016. The graph below displays the number of hedge funds with bullish position in SID over the last 5 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Jim Simons’ Renaissance Technologies, one of the largest hedge funds in the world, has the number one position in Companhia Siderurgica Nacional (ADR) (NYSE:SID), worth close to $3.9 million. Sitting at the No. 2 spot is Israel Englander’s Millennium Management, with a $0.4 million position. Remaining hedge funds and institutional investors that hold long positions comprise D. E. Shaw’s D E Shaw, Cliff Asness’ AQR Capital Management and John Overdeck and David Siegel’s Two Sigma Advisors. 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.

Due to the fact that Companhia Siderurgica Nacional (ADR) (NYSE:SID) has gone through falling interest from the smart money, logic holds that there lies a certain “tier” of fund managers that elected to cut their positions entirely by the end of the third quarter. Intriguingly, Ken Griffin’s Citadel Investment Group said goodbye to the biggest position of the 700 funds tracked by Insider Monkey, valued at about $0.1 million in stock.

Let’s also examine hedge fund activity in other stocks similar to Companhia Siderurgica Nacional (ADR) (NYSE:SID). We will take a look at CAE, Inc. (USA) (NYSE:CAE), Allied World Assurance Co Holdings, AG. (NYSE:AWH), Prosperity Bancshares, Inc. (NYSE:PB), and CyrusOne Inc (NASDAQ:CONE). This group of stocks’ market caps are closest to SID’s market cap.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $158 million. That figure was $5 million in SID’s case. CyrusOne Inc (NASDAQ:CONE) is the most popular stock in this table. On the other hand Prosperity Bancshares, Inc. (NYSE:PB) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Companhia Siderurgica Nacional (ADR) (NYSE:SID) is even less popular than PB. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

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