You probably know from experience that there is not as much information on small-cap companies as there is on large companies. Of course, this makes it really hard and difficult for individual investors to make a proper and accurate analysis of certain small-cap companies. However, well-known and successful hedge fund investors like Carl Icahn and George Soros hold the necessary resources and abilities to conduct an extensive stock analysis on small-cap stocks, which enable them to make millions of dollars by identifying potential winners within the small-cap galaxy of stocks. This represents the main reason why Insider Monkey takes notice of the hedge fund activity in these overlooked stocks.
Superior Industries International Inc. (NYSE:SUP) shareholders have witnessed an increase in enthusiasm from smart money recently. SUP was in 12 hedge funds’ portfolios at the end of the third quarter of 2015. There were 7 hedge funds in our database with SUP positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as NN, Inc. (NASDAQ:NNBR), Double Eagle Acquisition Corp (NASDAQ:EAGL), and Xencor Inc (NASDAQ:XNCR) to gather more data points.
To most shareholders, hedge funds are viewed as unimportant, outdated investment tools of yesteryear. While there are more than 8000 funds trading today, Our experts hone in on the upper echelon of this group, approximately 700 funds. Most estimates calculate that this group of people command the majority of all hedge funds’ total asset base, and by tailing their top investments, Insider Monkey has spotted a few investment strategies that have historically exceeded the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points per annum for a decade in their back tests.
Now, let’s take a glance at the key action surrounding Superior Industries International Inc. (NYSE:SUP).
How have hedgies been trading Superior Industries International Inc. (NYSE:SUP)?
At the end of the third quarter, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 71% from the second quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, GAMCO Investors, managed by Mario Gabelli, holds the number one position in Superior Industries International Inc. (NYSE:SUP). GAMCO Investors has a $35.7 million position in the stock, comprising 0.2% of its 13F portfolio. On GAMCO Investors’s heels is Royce & Associates, managed by Chuck Royce, which holds a $13.2 million position; 0.1% of its 13F portfolio is allocated to the company. Some other members of the smart money that are bullish consist of Jim Simons’s Renaissance Technologies, and Israel Englander’s Millennium Management.
As industrywide interest jumped, key money managers were leading the bulls’ herd. Citadel Investment Group, managed by Ken Griffin, initiated the most outsized position in Superior Industries International Inc. (NYSE:SUP). Citadel Investment Group had $0.8 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also initiated a $0.4 million position during the quarter. The other funds with new positions in the stock are D. E. Shaw’s D E Shaw, Peter Muller’s PDT Partners, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Superior Industries International Inc. (NYSE:SUP) but similarly valued. We will take a look at NN, Inc. (NASDAQ:NNBR), Double Eagle Acquisition Corp (NASDAQ:EAGL), Xencor Inc (NASDAQ:XNCR), and Carmike Cinemas, Inc. (NASDAQ:CKEC). All of these stocks’ market caps resemble SUP’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 21 hedge funds with bullish positions and the average amount invested in these stocks was $110 million. That figure was $58 million in SUP’s case. Carmike Cinemas, Inc. (NASDAQ:CKEC) is the most popular stock in this table, while the least popular one is NN, Inc. (NASDAQ:NNBR). Compared to these stocks Superior Industries International Inc. (NYSE:SUP), with 12 bullish hedge fund positions is even less popular than NNBR. 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.