Hedge Funds Are Buying Bruker Corporation (BRKR)

Hedge fund managers like David Einhorn, Dan Loeb, or Carl Icahn became billionaires through reaping large profits for their investors, which is why piggybacking their stock picks may provide us with significant returns as well. Many hedge funds, like Paul Singer’s Elliott Management, are pretty secretive, but we can still get some insights by analyzing their quarterly 13F filings. One of the most fertile grounds for large abnormal returns is hedge funds’ most popular small-cap picks, which are not so widely followed and often trade at a discount to their intrinsic value. In this article we will check out hedge fund activity in another small-cap stock: Bruker Corporation (NASDAQ:BRKR).

Bruker Corporation (NASDAQ:BRKR) investors should be aware of an increase in hedge fund sentiment of late. Bruker Corporation (NASDAQ:BRKR) was in 20 hedge funds’ portfolios at the end of the third quarter of 2015. There were 15 hedge funds in our database with Bruker Corporation (NASDAQ:BRKR) positions at the end of the previous quarter. At the end of this article, we will also compare Bruker Corporation (NASDAQ:BRKR) to other stocks, including Care Capital Properties Inc (NYSE:CCP), Sunstone Hotel Investors Inc (NYSE:SHO), and Bank of Hawaii Corporation (NYSE:BOH) to get a better sense of its popularity.

In today’s marketplace, there are tons of formulas stock traders put to use to value stocks. A duo of the most under-the-radar formulas are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the top picks of the best fund managers can beat the S&P 500 by a significant amount (see the details here).

Now, we’re going to go over the recent action encompassing Bruker Corporation (NASDAQ:BRKR).

What have hedge funds been doing with Bruker Corporation (NASDAQ:BRKR)?

At the end of September, a total of 20 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 33% from the second quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Select Equity Group, managed by Robert Joseph Caruso, holds the number one position in Bruker Corporation (NASDAQ:BRKR). Select Equity Group has a $76.9 million position in the stock, comprising 0.7% of its 13F portfolio. Sitting at the No. 2 spot is Israel Englander of Millennium Management, with a $33.7 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining peers with similar optimism encompass Dmitry Balyasny’s Balyasny Asset Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Mariko Gordon’s Daruma Asset Management.

Now, specific money managers have been driving this bullishness. Arrowstreet Capital assembled the biggest position in Bruker Corporation (NASDAQ:BRKR). Arrowstreet Capital had $5 million invested in the company at the end of the quarter. Jacob Gottlieb’s Visium Asset Management also initiated a $2.5 million position during the quarter. The following funds were also among the new Bruker Corporation (NASDAQ:BRKR) investors: Ken Gray and Steve Walsh’s Bryn Mawr Capital, Ken Griffin’s Citadel Investment Group, and Ray Dalio’s Bridgewater Associates.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Bruker Corporation (NASDAQ:BRKR) but similarly valued. We will take a look at Care Capital Properties Inc (NYSE:CCP), Sunstone Hotel Investors Inc (NYSE:SHO), Bank of Hawaii Corporation (NYSE:BOH), and Chimera Investment Corporation (NYSE:CIM). This group of stocks’ market caps matches Bruker Corporation (NASDAQ:BRKR)’s market cap.

As you can see, these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $124 million. That figure was $138 million in Bruker Corporation (NASDAQ:BRKR)’s case. Chimera Investment Corporation (NYSE:CIM) is the most popular stock in this table. On the other hand, Bank of Hawaii Corporation (NYSE:BOH) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks, Bruker Corporation (NASDAQ:BRKR) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.