Hedge Fund Consensus Stocks vs. Liberty Property Trust (LPT) In 2019

Hedge funds and other investment firms that we track manage billions of dollars of their wealthy clients’ money, and needless to say, they are painstakingly thorough when analyzing where to invest this money, as their own wealth also depends on it. Regardless of the various methods used by elite investors like David Tepper and David Abrams, the resources they expend are second-to-none. This is especially valuable when it comes to small-cap stocks, which is where they generate their strongest outperformance, as their resources give them a huge edge when it comes to studying these stocks compared to the average investor, which is why we intently follow their activity in the small-cap space. Nevertheless, it is also possible to identify cheap large cap stocks by following the footsteps of best performing hedge funds. What do these smart investors think about Liberty Property Trust (NYSE:LPT)?

Is Liberty Property Trust (NYSE:LPT) ready to rally soon? The best stock pickers are taking an optimistic view. The number of long hedge fund positions improved by 10 in recent months. Our calculations also showed that LPT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video at the end of this article for Q2 rankings).

In the financial world there are a lot of indicators stock market investors have at their disposal to value their stock investments. A duo of the less known indicators are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the best picks of the top hedge fund managers can outperform the market by a significant amount (see the details here).

Clint Carlson of Carlson Capital

We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager’s investor letter and the stock is still extremely cheap despite already gaining 20 percent. Now we’re going to take a gander at the latest hedge fund action encompassing Liberty Property Trust (NYSE:LPT).

How are hedge funds trading Liberty Property Trust (NYSE:LPT)?

At the end of the third quarter, a total of 29 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 53% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in LPT over the last 17 quarters. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).

More specifically, Zimmer Partners was the largest shareholder of Liberty Property Trust (NYSE:LPT), with a stake worth $218.3 million reported as of the end of September. Trailing Zimmer Partners was Long Pond Capital, which amassed a stake valued at $98.9 million. Citadel Investment Group, Land & Buildings Investment Management, and Carlson Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Shoals Capital Management allocated the biggest weight to Liberty Property Trust (NYSE:LPT), around 9.53% of its 13F portfolio. Land & Buildings Investment Management is also relatively very bullish on the stock, setting aside 8.52 percent of its 13F equity portfolio to LPT.

Now, specific money managers were leading the bulls’ herd. Citadel Investment Group, managed by Ken Griffin, assembled the largest position in Liberty Property Trust (NYSE:LPT). Citadel Investment Group had $55.7 million invested in the company at the end of the quarter. Matthew Halbower’s Pentwater Capital Management also made a $12.8 million investment in the stock during the quarter. The other funds with brand new LPT positions are Benjamin A. Smith’s Laurion Capital Management, Paul Marshall and Ian Wace’s Marshall Wace, and Jeffrey Hinkle’s Shoals Capital Management.

Let’s check out hedge fund activity in other stocks similar to Liberty Property Trust (NYSE:LPT). These stocks are Perrigo Company plc (NYSE:PRGO), ServiceMaster Global Holdings Inc (NYSE:SERV), AptarGroup, Inc. (NYSE:ATR), and AngloGold Ashanti Limited (NYSE:AU). This group of stocks’ market valuations match LPT’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
PRGO 15 453537 -6
SERV 26 927792 -4
ATR 22 112361 2
AU 19 454469 3
Average 20.5 487040 -1.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 20.5 hedge funds with bullish positions and the average amount invested in these stocks was $487 million. That figure was $576 million in LPT’s case. ServiceMaster Global Holdings Inc (NYSE:SERV) is the most popular stock in this table. On the other hand Perrigo Company plc (NYSE:PRGO) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks Liberty Property Trust (NYSE:LPT) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. Hedge funds were also right about betting on LPT as the stock returned 48% in 2019 and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

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