Do Hedge Funds Love OMNOVA Solutions Inc. (OMN)?

The 700+ hedge funds and money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund positions. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards OMNOVA Solutions Inc. (NYSE:OMN).

OMNOVA Solutions Inc. (NYSE:OMN)’s stock was losing ground in the third quarter, but the funds we track remained bullish on the stock. Moreover, it registered an increase in support from the funds we track. The company was in 14 hedge funds’ portfolios at the end of the third quarter of 2015. At the end of this article we will also compare OMN to other stocks including Oclaro, Inc. (NASDAQ:OCLR), Tucows Inc. (USA) (NASDAQ:TCX), and Westmoreland Coal Company (NASDAQ:WLB) to get a better sense of its popularity.

Follow Omnova Solutions Inc (NYSE:OMN)

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Now, let’s take a look at the key action encompassing OMNOVA Solutions Inc. (NYSE:OMN).

How are hedge funds trading OMNOVA Solutions Inc. (NYSE:OMN)?

At the end of the third quarter, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, up by two funds over the quarter. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, GAMCO Investors, managed by Mario Gabelli, holds the number one position in OMNOVA Solutions Inc. (NYSE:OMN). GAMCO Investors has an $6.8 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second most bullish fund is Peter Schliemann’s Rutabaga Capital Management, with an $3.5 million position; 0.4% of its 13F portfolio is allocated to the stock. Some other members of the smart money with similar optimism include Jim Simons’ Renaissance Technologies, Andy Redleaf’s Whitebox Advisors, and George Hall’s Clinton Group.

As industrywide interest jumped, key hedge funds were breaking ground themselves. Bryn Mawr Capital, managed by Ken Gray and Steve Walsh, created the largest position in OMNOVA Solutions Inc. (NYSE:OMN). Bryn Mawr Capital had $0.4 million invested in the company at the end of the quarter. Chao Ku’s Nine Chapters Capital Management also made an $0.1 million investment in the stock during the quarter. The only other fund with a brand new OMN position is Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as OMNOVA Solutions Inc. (NYSE:OMN) but similarly valued. These stocks are Oclaro, Inc. (NASDAQ:OCLR), Tucows Inc. (USA) (NASDAQ:TCX), Westmoreland Coal Company (NASDAQ:WLB), and Territorial Bancorp Inc (NASDAQ:TBNK). This group of stocks’ market valuations resemble OMN’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
OCLR 15 40413 2
TCX 11 41369 2
WLB 19 95715 -2
TBNK 8 21595 1

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $50 million. That figure was $16 million in OMN’s case. Westmoreland Coal Company (NASDAQ:WLB) is the most popular stock in this table with a total of 19 funds reporting long positions. On the other hand Territorial Bancorp Inc (NASDAQ:TBNK) is the least popular one with only 8 bullish hedge fund positions. OMNOVA Solutions Inc. (NYSE:OMN) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard WLB might be a better candidate to consider a long position.