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Do Hedge Funds Love SCANA Corporation (SCG)?

We at Insider Monkey have gone over 700 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. In this article, we look at what those funds think of SCANA Corporation (NYSE:SCG) based on that data.

SCANA Corporation (NYSE:SCG) investors should pay attention to an increase in enthusiasm from smart money lately. Our calculations also showed that SCG isn’t among the 30 most popular stocks among hedge funds.

To most stock holders, hedge funds are assumed to be underperforming, old investment tools of years past. While there are more than 8,000 funds trading at the moment, Our researchers look at the leaders of this group, about 700 funds. It is estimated that this group of investors handle bulk of the smart money’s total capital, and by watching their highest performing equity investments, Insider Monkey has spotted a few investment strategies that have historically outperformed the market. Insider Monkey’s flagship hedge fund strategy outpaced the S&P 500 index by 6 percentage points annually since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 24% since February 2017 (through December 3rd) even though the market was up nearly 23% during the same period. We just shared a list of 11 short targets in our latest quarterly update.

Izzy Englander of MILLENNIUM MANAGEMENT

Let’s take a look at the recent hedge fund action regarding SCANA Corporation (NYSE:SCG).

What does the smart money think about SCANA Corporation (NYSE:SCG)?

Heading into the fourth quarter of 2018, a total of 30 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 58% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in SCG over the last 13 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

SCG_dec2018

More specifically, Magnetar Capital was the largest shareholder of SCANA Corporation (NYSE:SCG), with a stake worth $146.9 million reported as of the end of September. Trailing Magnetar Capital was King Street Capital, which amassed a stake valued at $44.6 million. Mason Capital Management, Millennium Management, and Jet Capital Investors were also very fond of the stock, giving the stock large weights in their portfolios.

As one would reasonably expect, specific money managers were leading the bulls’ herd. Millennium Management, managed by Israel Englander, initiated the most outsized position in SCANA Corporation (NYSE:SCG). Millennium Management had $28.5 million invested in the company at the end of the quarter. Robert Emil Zoellner’s Alpine Associates also made a $14 million investment in the stock during the quarter. The following funds were also among the new SCG investors: Howard Guberman’s Gruss Asset Management, Sara Nainzadeh’s Centenus Global Management, and Clint Carlson’s Carlson Capital.

Let’s now review hedge fund activity in other stocks similar to SCANA Corporation (NYSE:SCG). We will take a look at Universal Display Corporation (NASDAQ:OLED), Wyndham Hotels & Resorts, Inc. (NYSE:WH), The Goodyear Tire & Rubber Company (NASDAQ:GT), and Healthcare Trust Of America Inc (NYSE:HTA). This group of stocks’ market caps resemble SCG’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
OLED 20 192336 -2
WH 39 991793 5
GT 25 654247 3
HTA 16 321403 1
Average 25 539945 1.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $540 million. That figure was $379 million in SCG’s case. Wyndham Hotels & Resorts, Inc. (NYSE:WH) is the most popular stock in this table. On the other hand Healthcare Trust Of America Inc (NYSE:HTA) is the least popular one with only 16 bullish hedge fund positions. SCANA Corporation (NYSE:SCG) 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 WH might be a better candidate to consider a long position.

Disclosure: None. This article was originally published at Insider Monkey.

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