With the third-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the fourth quarter. One of these stocks was CARBO Ceramics Inc. (NYSE:CRR).
CARBO Ceramics Inc. (NYSE:CRR) has seen a decrease in support from the world’s most elite money managers lately. CARBO Ceramics Inc. (NYSE:CRR) was in 7 hedge funds’ portfolios at the end of September. There were 14 hedge funds in our database with CARBO Ceramics Inc. (NYSE:CRR) holdings at the end of the previous quarter. It is important to note that the shares of CARBO Ceramics Inc. (NYSE:CRR) were down 54.38% during the third quarter, sharing the opinion of the hedge funds. For an in-depth understanding of the hedge fund sentiment surrounding the company, we will find out more about hedge funds that held positions in CARBO Ceramics Inc. (NYSE:CRR) at the end of the last 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 Stein Mart, Inc. (NASDAQ:SMRT), Forestar Group Inc. (NYSE:FOR), and ReTailMeNot Inc (NASDAQ:SALE) to gather more data points.
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At the moment, there are numerous indicators shareholders employ to size up stocks. Some of the most useful indicators are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the best picks of the elite money managers can beat the S&P 500 by a superb margin (see the details here).
Now, we’re going to take a look at the recent action encompassing CARBO Ceramics Inc. (NYSE:CRR).
What have hedge funds been doing with CARBO Ceramics Inc. (NYSE:CRR)?
At the end of the third quarter, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, a decline of 50% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
According to Insider Monkey’s hedge fund and institutional investor database, Royce & Associates, managed by Chuck Royce, holds the largest position in CARBO Ceramics Inc. (NYSE:CRR). Royce & Associates has a $9.8 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Coatue Management, managed by Philippe Laffont, which holds a $9.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining peers that hold long positions containD E Shaw, Tom Gayner’s Markel Gayner Asset Management, and Ken Griffin’s Citadel Investment Group.
Because CARBO Ceramics Inc. (NYSE:CRR) has faced a declination in interest from hedge fund managers, it’s easy to see that there exists a select few hedge funds who were dropping their full holdings last quarter. It’s worth mentioning that Dmitry Balyasny’s Balyasny Asset Management said goodbye to the largest position of the 700 funds followed by Insider Monkey, totaling about $19.1 million in CALL options.. Sander Gerber’s fund, Hudson Bay Capital Management, also dumped its CALL options., about $12.5 million worth of options. These transactions are important to note, as total hedge fund interest dropped by 7 funds last quarter.
Let’s also examine hedge fund activity in other stocks similar to CARBO Ceramics Inc. (NYSE:CRR). These stocks are Stein Mart, Inc. (NASDAQ:SMRT), Forestar Group Inc. (NYSE:FOR), ReTailMeNot Inc (NASDAQ:SALE), and Sunedison Semiconductor Ltd (NASDAQ:SEMI). This group of stocks’ market caps are closest to CARBO Ceramics Inc. (NYSE:CRR)’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SMRT | 13 | 62235 | -3 |
| FOR | 8 | 67469 | -5 |
| SALE | 15 | 79722 | -6 |
| SEMI | 21 | 216785 | -3 |
As you can see, these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $107 million. That figure was $32 million in CARBO Ceramics Inc. (NYSE:CRR)’s case. Sunedison Semiconductor Ltd (NASDAQ:SEMI) is the most popular stock in this table. On the other hand, Forestar Group Inc. (NYSE:FOR) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks, CARBO Ceramics Inc. (NYSE:CRR) is even less popular than Forestar Group Inc. (NYSE:FOR). Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case, more research is warranted.
