We have been waiting for this for a year and finally the third quarter ended up showing a nice bump in the performance of small-cap stocks. Both the S&P 500 and Russell 2000 were up since the end of the second quarter, but small-cap stocks outperformed the large-cap stocks by double digits. This is important for hedge funds, which are big supporters of small-cap stocks, because their investors started pulling some of their capital out due to poor recent performance. It is very likely that equity hedge funds will deliver better risk adjusted returns in the second half of this year. In this article we are going to look at how this recent market trend affected the sentiment of hedge funds towards AmeriGas Partners, L.P. (NYSE:APU) , and what that likely means for the prospects of the company and its stock.
AmeriGas Partners, L.P. (NYSE:APU) was in 8 hedge funds’ portfolios at the end of the third quarter of 2016. APU investors should pay attention to an increase in support from the world’s most successful money managers recently. There were 5 hedge funds in our database with APU holdings at the end of the previous quarter. At the end of this article we will also compare APU to other stocks including FNFV Group (NYSE:FNFV), Great Plains Energy Incorporated (NYSE:GXP), and Lincoln Electric Holdings, Inc. (NASDAQ:LECO) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
Keeping this in mind, let’s take a look at the key action surrounding AmeriGas Partners, L.P. (NYSE:APU).
How are hedge funds trading AmeriGas Partners, L.P. (NYSE:APU)?
At the end of the third quarter, a total of 8 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 60% from the second quarter of 2016. On the other hand, there were a total of 9 hedge funds with a bullish position in APU at the beginning of this year. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, McKinley Capital Management, led by Robert B. Gillam, holds the largest position in AmeriGas Partners, L.P. (NYSE:APU). McKinley Capital Management has a $1.8 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Renaissance Technologies, one of the largest hedge funds in the world, holding a $1.4 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that are bullish encompass Matthew Hulsizer’s PEAK6 Capital Management, Christopher C. Grisanti’s Grisanti Brown & Partners and Joshua Packwood and Schuster Tanger’s Radix Partners. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.