Billionaire hedge fund managers such as Steve Cohen and Stan Druckenmiller can generate millions or even billions of dollars every year by pinning down high-potential small-cap stocks and pouring cash into these candidates. Small-cap stocks are overlooked by most investors, brokerage houses, and financial services hubs, while the unlimited research abilities of the big players within the hedge fund industry can easily identify the undervalued and high-potential stocks that reside the ignored corners of equity markets. There are numerous small-cap stocks that have turned out to be great winners, which is one of the main reasons the Insider Monkey team pays close attention to the hedge fund activity in relation to these stocks.
Coeur Mining Inc (NYSE:CDE) was in 16 hedge funds’ portfolios at the end of the third quarter of 2015. CDE has experienced an increase in activity from the world’s largest hedge funds of late. There were 14 hedge funds in our database with CDE holdings at the end of the previous quarter. At the end of this article we will also compare CDE to other stocks, including Blue Nile Inc (NASDAQ:NILE), Easterly Government Properties Inc (NYSE:DEA), and Middlesex Water Company (NASDAQ:MSEX) to get a better sense of its popularity.
According to most shareholders, hedge funds are perceived as underperforming, outdated financial vehicles of yesteryear. While there are more than 8000 funds in operation at present, We look at the bigwigs of this club, about 700 funds. Most estimates calculate that this group of people command most of all hedge funds’ total capital, and by watching their best picks, Insider Monkey has spotted many investment strategies that have historically outstripped the broader indices. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points per annum for a decade in their back tests.
With all of this in mind, we’re going to take a look at the latest action surrounding Coeur Mining Inc (NYSE:CDE).
What have hedge funds been doing with Coeur Mining Inc (NYSE:CDE)?
At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 14% from the second quarter. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Millennium Management, managed by Israel Englander, holds the most valuable position in Coeur Mining Inc (NYSE:CDE), worth approximately $6.7 million, comprising less than 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Shah Capital Management, managed by Himanshu H. Shah, which holds a $6.2 million position; the fund has 6.4% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions include Gilchrist Berg’s Water Street Capital, Chuck Royce’s Royce & Associates and Jim Simons’s Renaissance Technologies.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Highbridge Capital Management, managed by Glenn Russell Dubin, established the biggest position in Coeur Mining Inc (NYSE:CDE). According to its latest 13F filing, the fund had $1.6 million invested in the company at the end of the quarter. Peter Franklin Palmedo’s Sun Valley Gold also initiated a $0.6 million position during the quarter. The following funds were also among the new CDE investors: Paul Tudor Jones’s Tudor Investment Corp, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Matthew Tewksbury’s Stevens Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to Coeur Mining Inc (NYSE:CDE). We will take a look at Blue Nile Inc (NASDAQ:NILE), Easterly Government Properties Inc (NYSE:DEA), Middlesex Water Company (NASDAQ:MSEX), and Bellicum Pharmaceuticals Inc (NASDAQ:BLCM). This group of stocks’ market values are similar to CDE’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was just $32 million in CDE’s case. Blue Nile Inc (NASDAQ:NILE) and Bellicum Pharmaceuticals Inc (NASDAQ:BLCM) lead the pack, while Easterly Government Properties Inc (NYSE:DEA) and Easterly Government Properties Inc (NYSE:DEA) are at the other end of the specter with only 7 bullish hedge fund positions each. Compared to these stocks Coeur Mining Inc (NYSE:CDE) 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.