At Insider Monkey, we pore over the filings of more than 700 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of September 30. In this article, we will use that wealth of knowledge to determine whether or not SL Green Realty Corp (NYSE:SLG) makes for a good investment right now.
SL Green Realty Corp (NYSE:SLG) was in 24 hedge funds’ portfolios at the end of September. SLG investors should be aware of an increase in hedge fund interest of late. There were 21 hedge funds in our database with SLG positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as ONEOK, Inc. (NYSE:OKE), Vantiv Inc (NYSE:VNTV), and Hologic, Inc. (NASDAQ:HOLX) to gather more data points.
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.
What have hedge funds been doing with SL Green Realty Corp (NYSE:SLG)?
At the end of the third quarter, a total of 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, up by 14% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in SLG over the last 5 quarters. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Jim Simons’ Renaissance Technologies holds the largest position in SL Green Realty Corp (NYSE:SLG). Renaissance Technologies has a $49.7 million position in the stock. Sitting at the No. 2 spot is Citadel Investment Group, led by Ken Griffin, holding a $44.6 million position. Remaining hedge funds and institutional investors with similar optimism contain Phill Gross and Robert Atchinson’s Adage Capital Management, George Hall’s Clinton Group and Israel Englander’s Millennium Management. 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.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Clinton Group, led by George Hall, created the largest position in SL Green Realty Corp (NYSE:SLG). Clinton Group had $12.5 million invested in the company at the end of the quarter. The following funds were also among the new SLG investors: Emanuel J. Friedman’s EJF Capital, Alec Litowitz and Ross Laser’s Magnetar Capital, and John Overdeck and David Siegel’s Two Sigma Advisors.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as SL Green Realty Corp (NYSE:SLG) but similarly valued. We will take a look at ONEOK, Inc. (NYSE:OKE), Vantiv Inc (NYSE:VNTV), Hologic, Inc. (NASDAQ:HOLX), and Textron Inc. (NYSE:TXT). This group of stocks’ market valuations match SLG’s market valuation.
|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 23 hedge funds with bullish positions and the average amount invested in these stocks was $468 million. That figure was $201 million in SLG’s case. Hologic, Inc. (NASDAQ:HOLX) is the most popular stock in this table. On the other hand ONEOK, Inc. (NYSE:OKE) is the least popular one with only 14 bullish hedge fund positions. SL Green Realty Corp (NYSE:SLG) 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 HOLX might be a better candidate to consider taking a long position in.