Hedge Funds Like These Five Declining Stocks in Q4

#3 United Rentals, Inc. (NYSE:URI)

Investors with Long Positions (as of September 30): 52

Aggregate Value of Investors’ Holdings (as of September 30): $783 Million

Although shares of United Rentals, Inc. (NYSE:URI) had started their downward journey in late-May itself, it was in the third quarter that they lost a hefty 31.5% and came down to levels last seen in 2013. Hedge funds made full use of this opportunity with the ownership of the company among funds covered by us rising by 8 during the that period. However, the aggregate value of investors’ holding in the company during the third quarter came down by 43.6%. Shares of United Rentals, Inc. (NYSE:URI) managed a recovery in fourth quarter, but are still trading down more than 26% year-to-date. On October 23, analysts at Barclays reiterated their ‘Overweight’ rating on the stock, while increasing their price target on it to $80 from $77. Richard Mcguire‘s Marcato Capital Management initiated a stake in United Rentals during the third quarter by purchasing over 2 million shares of the company.

#2 Caterpillar Inc. (NYSE:CAT)

Investors with Long Positions (as of September 30): 40

Aggregate Value of Investors’ Holdings (as of September 30): $1.82 Billion

Construction equipment manufacturing giant Caterpillar Inc. (NYSE:CAT) has had it pretty rough since the start of second-half of 2014. This year the company’s stock has followed a classic bearish trend line and till now has lost almost 25% of its market capitalization year-to-date. During the third quarter when the stock of the company slumped 22.2%, the number of hedge funds that were long  in it increased by 10 and the aggregate value of investors’ holding in the company saw a meager decline of 9%. On November 20 the company announced that it would be closing its undercarriage components facility in Danville. On November 23 analysts at Societe Generale reiterated their ‘Buy’ rating on Caterpillar Inc. (NYSE:CAT)’s stock, while upping their price target on it to $82 from $81. Billionaire David E. Shaw‘s firm, D. E. Shaw, was one of the hedge funds that increased its stake significantly in Caterpillar during the third quarter; it holds 728,650 shares of the company as of September 30.

#1 Apache Corporation (NYSE:APA)

Investors with Long Positions (as of September 30): 45

Aggregate Value of Investors’ Holdings (as of September 30): $1.33 Billion

The decline in crude oil prices took a serious toll on the shares of Apache Corporation (NYSE:APA) during the second and third quarter. However, its popularity among hedge funds climbed to new heights during the same period. While Apache Corporation (NYSE:APA)’s stock went down by over 30% during the third quarter, the number of hedge funds covered by Insider Monkey, that were long in it, increased by 13 during the same period. Moreover, Apache Corporation is also the only stock in this list, which not only saw the number of hedge funds that held stake in it increasing, but also the aggregate value of hedge funds’ holdings going up (by $27 million). The stock did manage to recover a bit during October and November, but have again started declining recently and now is trading down by 28.56% year-to-date. On November 9 Apache Corporation’s stock jumped by 10% after reports emerged that the company has received and rejected an acquisition offer from an unidentified buyer. On Wednesday, analysts at  Jefferies Group reiterated their ‘Underperform’ rating on the stock, but upped their price target on it to $43 from $49. With an ownership of over 13.44 million shares, William B. Gray‘s Orbis Investment Management was its largest shareholder at the end of September among funds covered in our database.

Disclosure: None