Hedge funds and other investment firms run by legendary investors like Israel Englander and Ray Dalio are entrusted to manage billions of dollars of accredited investors’ money because they are without peer in the resources they use to identify the best investments for their chosen investment horizon. Moreover, they are more willing to invest a greater amount of their resources in small-cap stocks than big brokerage houses, and this is often where they generate their outperformance, which is why we pay particular attention to their best ideas in this space.
Is Constellium NV (NYSE:CSTM) worth your attention right now? The smart money is turning bullish. The number of long hedge fund bets moved up by 4 recently. At the end of this article we will also compare CSTM to other stocks including ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS), Green Plains Partners LP (NASDAQ:GPP), and HomeStreet Inc (NASDAQ:HMST) to get a better sense of its popularity.
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.
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Keeping this in mind, we’re going to analyze the key action regarding Constellium NV (NYSE:CSTM).
How have hedgies been trading Constellium NV (NYSE:CSTM)?
At the end of the third quarter, a total of 32 of the hedge funds tracked by Insider Monkey were long this stock, a gain of 14% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, North Run Capital, managed by Thomas Ellis and Todd Hammer, holds the most valuable position in Constellium NV (NYSE:CSTM). North Run Capital has a $53 million position in the stock, comprising 8.3% of its 13F portfolio. The second most bullish fund manager is D E Shaw, led by D. E. Shaw, holding a $44.3 million position. Other members of the smart money that are bullish contain Phill Gross and Robert Atchinson’s Adage Capital Management, Kevin Michael Ulrich and Anthony Davis’s Anchorage Advisors and Michael Kaufman’s MAK Capital One.
Now, key hedge funds have jumped into Constellium NV (NYSE:CSTM) headfirst. Anchorage Advisors, assembled the biggest position in Constellium NV (NYSE:CSTM). Anchorage Advisors had $22.8 million invested in the company at the end of the quarter. Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital also initiated a $9.1 million position during the quarter. The following funds were also among the new CSTM investors: Robert Henry Lynch’s Aristeia Capital, Richard Driehaus’s Driehaus Capital, and Robert Polak’s Anchor Bolt Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Constellium NV (NYSE:CSTM) but similarly valued. We will take a look at ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS), Green Plains Partners LP (NASDAQ:GPP), HomeStreet Inc (NASDAQ:HMST), and Seadrill Partners LLC (NYSE:SDLP). This group of stocks’ market values resemble CSTM’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IMOS | 17 | 207132 | -1 |
| GPP | 5 | 83207 | 0 |
| HMST | 11 | 15773 | 0 |
| SDLP | 7 | 1670 | 0 |
As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $77 million. That figure was $284 million in CSTM’s case. ChipMOS Technologies (Bermuda) Ltd (NASDAQ:IMOS) is the most popular stock in this table. On the other hand Green Plains Partners LP (NASDAQ:GPP) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Constellium NV (NYSE:CSTM) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
