Hedge fund managers like David Einhorn, Dan Loeb, and Carl Icahn became billionaires through reaping large profits for their investors, which is why piggybacking their stock picks may provide us with significant returns as well. Many hedge funds, like Paul Singer’s Elliott Management, are pretty secretive, but we can still get some insights by analyzing their quarterly 13F filings. One of the most fertile grounds for large abnormal returns is hedge funds’ most popular small-cap picks, which are not so widely followed and often trade at a discount to their intrinsic value. In this article we will check out hedge fund activity in another small-cap stock: Freshpet Inc (NASDAQ:FRPT).
Freshpet Inc (NASDAQ:FRPT) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged, with the stock being in 6 hedge funds’ portfolios at the end of the third quarter of 2015. 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 Guaranty Bancorp (NASDAQ:GBNK), Financial Institutions, Inc. (NASDAQ:FISI), and Dynex Capital Inc (NYSE:DX) to gather more data points.
Today there are a lot of gauges stock traders put to use to value stocks. Some of the less known gauges are hedge fund and insider trading moves. We have shown that, historically, those who follow the top picks of the best money managers can outclass their index-focused peers by a healthy margin (see the details here).
Keeping this in mind, we’re going to take a look at the fresh action regarding Freshpet Inc (NASDAQ:FRPT).
Hedge fund activity in Freshpet Inc (NASDAQ:FRPT)
At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their holdings substantially (or had already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Steven Boyd’s Armistice Capital has the number one position in Freshpet Inc (NASDAQ:FRPT), worth close to $11.8 million, accounting for 4% of its total 13F portfolio. Sitting in the 2 spot is Citadel Investment Group, led by Ken Griffin, holding a $5.9 million position; less than 0.1% of its 13F portfolio is allocated to the stock. Remaining members of the smart money that are bullish consist of Eric Chen’s Antipodean Advisors, Michael Barnes and Arif Inayatullah’s Tricadia Capital Management, and Doug Gordon, Jon Hilsabeck and Don Jabro’s Shellback Capital.