Is Kimco Realty Corp (NYSE:KIM) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.
Is Kimco Realty Corp (NYSE:KIM) a buy, sell, or hold? Prominent investors are becoming less hopeful. The number of bullish hedge fund positions went down by 7 in recent months. At the end of this article, we will also compare Kimco Realty Corp (NYSE:KIM) to other stocks including Freeport-McMoRan Inc. (NYSE:FCX), Kansas City Southern (NYSE:KSU), and Foot Locker, Inc. (NYSE:FL) to get a better sense of its popularity.
Follow Kimco Realty Corp (NYSE:KIM)
Follow Kimco Realty Corp (NYSE:KIM)
In today’s marketplace, there are dozens of indicators investors employ to size up their stock investments. A duo of the most useful indicators are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the top picks of the best fund managers can trounce the market by a very impressive amount (see the details here).
Keeping this in mind, let’s check out the recent action surrounding Kimco Realty Corp (NYSE:KIM).
How have hedgies been trading Kimco Realty Corp (NYSE:KIM)?
At the end of the third quarter, a total of 13 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 35% from the second quarter. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, David Harding’s Winton Capital Management has the number one position in Kimco Realty Corp (NYSE:KIM), worth close to $50.4 million, amounting to 0.4% of its total 13F portfolio. The second most bullish fund manager is Waterfront Capital Partners, managed by Eduardo Abush, which holds a $19.2 million position; 2.7% of its 13F portfolio is allocated to the company. Remaining members of the smart money that are bullish include John Khoury’s Long Pond Capital, Phill Gross and Robert Atchinson’s Adage Capital Management, and Cliff Asness’ AQR Capital Management.
Since Kimco Realty Corp (NYSE:KIM) has witnessed a declining sentiment from the smart money, logic holds that there was a specific group of funds who sold off their entire stakes in the third quarter. Intriguingly, Renaissance Technologies dumped the biggest investment of all the hedgies watched by Insider Monkey, totaling an estimated $17.7 million in stock. D E Shaw also dumped its stock, about $8.1 million worth of shares. These transactions are interesting, as total hedge fund interest was cut by 7 funds in the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Kimco Realty Corp (NYSE:KIM). These stocks are Freeport-McMoRan Inc. (NYSE:FCX), Kansas City Southern (NYSE:KSU), Foot Locker, Inc. (NYSE:FL), and H&R Block, Inc. (NYSE:HRB). This group of stocks’ market valuations is similar to Kimco Realty Corp (NYSE:KIM)’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| FCX | 44 | 1390319 | 3 |
| KSU | 40 | 1448397 | 3 |
| FL | 25 | 670055 | 0 |
| HRB | 44 | 1090890 | 0 |
As you can see, these stocks had an average of 38 hedge funds with bullish positions and the average amount invested in these stocks was $1.15 billion. That figure was $111 million in Kimco Realty Corp (NYSE:KIM)’s case. Freeport-McMoRan Inc. (NYSE:FCX) is the most popular stock in this table. On the other hand, Foot Locker, Inc. (NYSE:FL) is the least popular one with only 25 bullish hedge fund positions. Compared to these stocks, Kimco Realty Corp (NYSE:KIM) is even less popular than Foot Locker, Inc. (NYSE:FL). 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.
