At Insider Monkey, we pore over the filings of more than 700 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of September 30. In this article, we will use that wealth of knowledge to determine whether or not Chico’s FAS, Inc. (NYSE:CHS) makes for a good investment right now.
Chico’s FAS, Inc. (NYSE:CHS) was in 23 hedge funds’ portfolios at the end of the third quarter of 2015. CHS investors should pay attention to an increase in hedge fund sentiment recently. There were 19 hedge funds in our database with CHS positions at the end of the previous quarter. At the end of this article we will also compare CHS to other stocks including SM Energy Co. (NYSE:SM), Asbury Automotive Group, Inc. (NYSE:ABG), and Teekay Corporation (NYSE:TK) to get a better sense of its popularity.
In the financial world there is a multitude of gauges market participants employ to value stocks. A couple of the most useful gauges are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the top picks of the best investment managers can beat their index-focused peers by a superb margin (see the details here).
With all of this in mind, let’s analyze the fresh action surrounding Chico’s FAS, Inc. (NYSE:CHS).
Hedge fund activity in Chico’s FAS, Inc. (NYSE:CHS)
Heading into Q4, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of 21% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Blue Harbour Group, managed by Clifton S. Robbins, holds the biggest position in Chico’s FAS, Inc. (NYSE:CHS). Blue Harbour Group has a $129 million position in the stock, comprising 4% of its 13F portfolio. The second most bullish fund manager is Renaissance Technologies, managed by Jim Simons, which holds a $62.2 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other peers with similar optimism consist of Joel Greenblatt’s Gotham Asset Management, Cliff Asness’s AQR Capital Management and Matthew Mark’s Jet Capital Investors.
Consequently, specific money managers were leading the bulls’ herd. Jet Capital Investors, managed by Matthew Mark, established a valuable position in Chico’s FAS, Inc. (NYSE:CHS). Jet Capital Investors had $26.2 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also initiated a $21.7 million position during the quarter. The following funds were also among the new CHS investors: Paul Marshall and Ian Wace’s Marshall Wace LLP, Chao Ku’s Nine Chapters Capital Management, and Michael Platt and William Reeves’s BlueCrest Capital Mgmt..
Let’s now take a look at hedge fund activity in other stocks similar to Chico’s FAS, Inc. (NYSE:CHS). These stocks are SM Energy Co. (NYSE:SM), Asbury Automotive Group, Inc. (NYSE:ABG), Teekay Corporation (NYSE:TK), and CyrusOne Inc (NASDAQ:CONE). All of these stocks’ market caps are closest to CHS’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 22 hedge funds with bullish positions and the average amount invested in these stocks was $389 million. That figure was $399 million in CHS’s case. The least popular stock in this table is CyrusOne Inc (NASDAQ:CONE), and the most popular one is Asbury Automotive Group, Inc. (NYSE:ABG). In comparison, Chico’s FAS, Inc. (NYSE:CHS), with 23 bullish hedge fund positions, is not the most nor the least popular one in this group. Although this may imply it is a stock worth considering, we’d rather spend our time focusing on stocks that hedge funds are piling on. In this regard, ABG might be a better alternative.