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Hedge Funds Are Buying Briggs & Stratton Corporation (BGG)

Insider Monkey finished processing more than 700 13F filings made by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30th. What do these smart investors think about Briggs & Stratton Corporation (NYSE:BGG)?

Is Briggs & Stratton Corporation (NYSE:BGG) a good stock to buy now? Hedge funds are betting on the stock. The number of bullish hedge fund bets went up by 4 in recent months. Our calculations also showed that bgg isn’t among the 30 most popular stocks among hedge funds.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 24% through December 3, 2018. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

CITADEL INVESTMENT GROUP

We’re going to analyze the latest hedge fund action surrounding Briggs & Stratton Corporation (NYSE:BGG).

Hedge fund activity in Briggs & Stratton Corporation (NYSE:BGG)

At the end of the third quarter, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of 36% from the second quarter of 2018. On the other hand, there were a total of 15 hedge funds with a bullish position in BGG at the beginning of this year. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).

No of Hedge Funds with BGG Positions

Among these funds, Renaissance Technologies held the most valuable stake in Briggs & Stratton Corporation (NYSE:BGG), which was worth $4.4 million at the end of the third quarter. On the second spot was Citadel Investment Group which amassed $3.7 million worth of shares. Moreover, Harvest Capital Strategies, Two Sigma Advisors, and D E Shaw were also bullish on Briggs & Stratton Corporation (NYSE:BGG), allocating a large percentage of their portfolios to this stock.

Consequently, key hedge funds have been driving this bullishness. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, assembled the most valuable position in Briggs & Stratton Corporation (NYSE:BGG). Arrowstreet Capital had $1.1 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also made a $0.9 million investment in the stock during the quarter. The other funds with brand new BGG positions are Roger Ibbotson’s Zebra Capital Management, Matthew Hulsizer’s PEAK6 Capital Management, and Dmitry Balyasny’s Balyasny Asset Management.

Let’s also examine hedge fund activity in other stocks similar to Briggs & Stratton Corporation (NYSE:BGG). These stocks are Virtus Investment Partners Inc (NASDAQ:VRTS), Monarch Casino & Resort, Inc. (NASDAQ:MCRI), Express, Inc. (NYSE:EXPR), and FutureFuel Corp. (NYSE:FF). All of these stocks’ market caps resemble BGG’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
VRTS 13 87596 1
MCRI 10 140921 -1
EXPR 24 129129 6
FF 11 72328 1
Average 14.5 107494 1.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $107 million. That figure was $24 million in BGG’s case. Express, Inc. (NYSE:EXPR) is the most popular stock in this table. On the other hand Monarch Casino & Resort, Inc. (NASDAQ:MCRI) is the least popular one with only 10 bullish hedge fund positions. Briggs & Stratton Corporation (NYSE:BGG) 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 EXPR might be a better candidate to consider a long position.

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

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