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Hedge Fund Sentiment Is Stagnant On Entegris Inc (ENTG)

We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Peltz’s recent General Electric losses). However, it is still good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Entegris Inc (NASDAQ:ENTG).

Hedge fund interest in Entegris Inc (NASDAQ:ENTG) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare ENTG to other stocks including Intelsat S.A. (NYSE:I), Lancaster Colony Corporation (NASDAQ:LANC), and Valvoline Inc. (NYSE:VVV) to get a better sense of its popularity.

If you’d ask most shareholders, hedge funds are perceived as worthless, old investment vehicles of the past. While there are greater than 8,000 funds with their doors open at present, Our researchers choose to focus on the crème de la crème of this club, around 700 funds. These hedge fund managers command the lion’s share of all hedge funds’ total capital, and by tracking their inimitable equity investments, Insider Monkey has unsheathed several investment strategies that have historically outpaced Mr. Market. Insider Monkey’s flagship hedge fund strategy beat 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.


Let’s analyze the latest hedge fund action surrounding Entegris Inc (NASDAQ:ENTG).

Hedge fund activity in Entegris Inc (NASDAQ:ENTG)

Heading into the fourth quarter of 2018, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, no change from the previous quarter. Below, you can check out the change in hedge fund sentiment towards ENTG over the last 13 quarters. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were upping their holdings considerably (or already accumulated large positions).


Of the funds tracked by Insider Monkey, GMT Capital, managed by Thomas E. Claugus, holds the biggest position in Entegris Inc (NASDAQ:ENTG). GMT Capital has a $240.2 million position in the stock, comprising 6.2% of its 13F portfolio. Coming in second is Robert G. Moses of RGM Capital, with a $50.2 million position; 4% of its 13F portfolio is allocated to the stock. Remaining members of the smart money that are bullish encompass Jim Simons’s Renaissance Technologies, Mariko Gordon’s Daruma Asset Management and Scott Phillips’s Latimer Light Capital.

Since Entegris Inc (NASDAQ:ENTG) has experienced falling interest from hedge fund managers, it’s safe to say that there is a sect of hedgies who were dropping their positions entirely heading into Q3. Intriguingly, Lee Ainslie’s Maverick Capital cut the biggest stake of all the hedgies tracked by Insider Monkey, totaling about $6.8 million in stock. Andrew Feldstein and Stephen Siderow’s fund, Blue Mountain Capital, also said goodbye to its stock, about $5.1 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s check out hedge fund activity in other stocks similar to Entegris Inc (NASDAQ:ENTG). These stocks are Intelsat S.A. (NYSE:I), Lancaster Colony Corporation (NASDAQ:LANC), Valvoline Inc. (NYSE:VVV), and MSA Safety Incorporated (NYSE:MSA). This group of stocks’ market values are similar to ENTG’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
I 37 1128740 14
LANC 16 230249 4
VVV 15 313449 3
MSA 10 65875 -3
Average 19.5 434578 4.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 19.5 hedge funds with bullish positions and the average amount invested in these stocks was $435 million. That figure was $479 million in ENTG’s case. Intelsat S.A. (NYSE:I) is the most popular stock in this table. On the other hand MSA Safety Incorporated (NYSE:MSA) is the least popular one with only 10 bullish hedge fund positions. Entegris Inc (NASDAQ:ENTG) 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 I might be a better candidate to consider a long position.

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

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