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Hedge Funds Are Betting On Belmond Ltd (BEL)

Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow over 700 of the best-performing investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Belmond Ltd (NYSE:BEL), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Belmond Ltd (NYSE:BEL) investors should pay attention to an increase in support from the world’s most elite money managers recently. Our calculations also showed that BEL isn’t among the 30 most popular stocks among hedge funds.

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 6.3% year to date (through December 3rd) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 18 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

D. E. Shaw

Let’s take a peek at the key hedge fund action regarding Belmond Ltd (NYSE:BEL).

Hedge fund activity in Belmond Ltd (NYSE:BEL)

At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from the second quarter of 2018. By comparison, 15 hedge funds held shares or bullish call options in BEL heading into this year. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).

BEL_dec2018

According to Insider Monkey’s hedge fund database, Mason Hawkins’s Southeastern Asset Management has the biggest position in Belmond Ltd (NYSE:BEL), worth close to $112.2 million, amounting to 1.3% of its total 13F portfolio. On Southeastern Asset Management’s heels is Long Pond Capital, managed by John Khoury, which holds a $32.6 million position; the fund has 0.9% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish contain Jeffrey Bronchick’s Cove Street Capital, D. E. Shaw’s D E Shaw and Robert Bishop’s Impala Asset Management.

Now, key money managers have been driving this bullishness. D E Shaw, managed by D. E. Shaw, created the biggest position in Belmond Ltd (NYSE:BEL). D E Shaw had $19.1 million invested in the company at the end of the quarter. Ian Cumming and Joseph Steinberg’s Leucadia National also made a $1.8 million investment in the stock during the quarter. The other funds with brand new BEL positions are Benjamin A. Smith’s Laurion Capital Management, Jim Simons’s Renaissance Technologies, and Steve Cohen’s Point72 Asset Management.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Belmond Ltd (NYSE:BEL) but similarly valued. We will take a look at Kronos Worldwide, Inc. (NYSE:KRO), Ladder Capital Corp (NYSE:LADR), Nuveen California Quality Municipal Income Fund (NYSE:NAC), and PIMCO Dynamic Income Fund (NYSE:PDI). This group of stocks’ market caps match BEL’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
KRO 17 51942 -1
LADR 17 114418 -3
NAC 2 678 -3
PDI 1 8798 0
Average 9.25 43959 -1.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $44 million. That figure was $253 million in BEL’s case. Kronos Worldwide, Inc. (NYSE:KRO) is the most popular stock in this table. On the other hand 0 is the least popular one with only 1 bullish hedge fund positions. Belmond Ltd (NYSE:BEL) 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 KRO might be a better candidate to consider a long position.

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

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