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Hedge Funds Warming Up To Taseko Mines Limited (TGB)

Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the first quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Taseko Mines Limited (NYSE:TGB) based on that data.

Taseko Mines Limited (NYSE:TGB) was in 4 hedge funds’ portfolios at the end of the first quarter of 2020. TGB investors should pay attention to an increase in hedge fund sentiment in recent months. There were 3 hedge funds in our database with TGB positions at the end of the previous quarter. Our calculations also showed that TGB isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 51 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

John Overdeck of Two Sigma

John Overdeck of Two Sigma Advisors

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s review the key hedge fund action surrounding Taseko Mines Limited (NYSE:TGB).

How are hedge funds trading Taseko Mines Limited (NYSE:TGB)?

Heading into the second quarter of 2020, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 33% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards TGB over the last 18 quarters. With the smart money’s capital changing hands, there exists a select group of noteworthy hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).

Is TGB A Good Stock To Buy?

When looking at the institutional investors followed by Insider Monkey, Renaissance Technologies, holds the number one position in Taseko Mines Limited (NYSE:TGB). Renaissance Technologies has a $2.3 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is John Overdeck and David Siegel of Two Sigma Advisors, with a $0 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other peers with similar optimism encompass Ken Griffin’s Citadel Investment Group, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Renaissance Technologies allocated the biggest weight to Taseko Mines Limited (NYSE:TGB), around 0.0022% of its 13F portfolio. Schonfeld Strategic Advisors is also relatively very bullish on the stock, dishing out 0.0006 percent of its 13F equity portfolio to TGB.

As aggregate interest increased, specific money managers have jumped into Taseko Mines Limited (NYSE:TGB) headfirst. Schonfeld Strategic Advisors, managed by Ryan Tolkin (CIO), established the most outsized position in Taseko Mines Limited (NYSE:TGB). Schonfeld Strategic Advisors had $0 million invested in the company at the end of the quarter.

Let’s now take a look at hedge fund activity in other stocks similar to Taseko Mines Limited (NYSE:TGB). These stocks are Barnes & Noble Education Inc (NYSE:BNED), AIM ImmunoTech Inc. (NYSE:AIM), SMTC Corporation (NASDAQ:SMTX), and China XD Plastics Co Ltd (NASDAQ:CXDC). This group of stocks’ market values are similar to TGB’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
BNED 14 3185 5
AIM 2 825 0
SMTX 4 5840 -1
CXDC 2 614 1
Average 5.5 2616 1.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 5.5 hedge funds with bullish positions and the average amount invested in these stocks was $3 million. That figure was $2 million in TGB’s case. Barnes & Noble Education Inc (NYSE:BNED) is the most popular stock in this table. On the other hand AIM ImmunoTech Inc. (NYSE:AIM) is the least popular one with only 2 bullish hedge fund positions. Taseko Mines Limited (NYSE:TGB) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. A small number of hedge funds were also right about betting on TGB as the stock returned 47.1% during the second quarter and outperformed the market by an even larger margin.

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