The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of CNX Resources Corporation (NYSE:CNX).
CNX Resources Corporation (NYSE:CNX) has experienced an increase in support from the world’s most elite money managers recently. CNX was in 24 hedge funds’ portfolios at the end of the first quarter of 2020. There were 18 hedge funds in our database with CNX positions at the end of the previous quarter. Our calculations also showed that CNX 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.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 101% since March 2017 and outperformed the S&P 500 ETFs by more than 58 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we are checking out investment opportunities like these. 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. Keeping this in mind we’re going to take a peek at the new hedge fund action regarding CNX Resources Corporation (NYSE:CNX).
What have hedge funds been doing with CNX Resources Corporation (NYSE:CNX)?
At Q1’s end, a total of 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 33% from the previous quarter. The graph below displays the number of hedge funds with bullish position in CNX over the last 18 quarters. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Mason Hawkins’s Southeastern Asset Management has the largest position in CNX Resources Corporation (NYSE:CNX), worth close to $257 million, amounting to 6.1% of its total 13F portfolio. On Southeastern Asset Management’s heels is David Einhorn of Greenlight Capital, with a $39.3 million position; the fund has 5.6% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors with similar optimism contain Phill Gross and Robert Atchinson’s Adage Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Boaz Weinstein’s Saba Capital. In terms of the portfolio weights assigned to each position Southeastern Asset Management allocated the biggest weight to CNX Resources Corporation (NYSE:CNX), around 6.11% of its 13F portfolio. Greenlight Capital is also relatively very bullish on the stock, earmarking 5.6 percent of its 13F equity portfolio to CNX.
Now, specific money managers were leading the bulls’ herd. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the biggest position in CNX Resources Corporation (NYSE:CNX). Adage Capital Management had $9.8 million invested in the company at the end of the quarter. Boaz Weinstein’s Saba Capital also initiated a $4.4 million position during the quarter. The following funds were also among the new CNX investors: Dmitry Balyasny’s Balyasny Asset Management, Steve Cohen’s Point72 Asset Management, and Vince Maddi and Shawn Brennan’s SIR Capital Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as CNX Resources Corporation (NYSE:CNX) but similarly valued. We will take a look at Broadmark Realty Capital Inc. (NYSE:BRMK), Eagle Bancorp, Inc. (NASDAQ:EGBN), Lindsay Corporation (NYSE:LNN), and Enerpac Tool Group Corp. (NYSE:EPAC). All of these stocks’ market caps are similar to CNX’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $112 million. That figure was $332 million in CNX’s case. Broadmark Realty Capital Inc. (NYSE:BRMK) is the most popular stock in this table. On the other hand Lindsay Corporation (NYSE:LNN) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks CNX Resources Corporation (NYSE:CNX) is more popular among hedge funds. 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 returned 13.9% in 2020 through June 10th but still managed to beat the market by 14.2 percentage points. Hedge funds were also right about betting on CNX as the stock returned 100.4% so far in Q2 (through June 10th) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Disclosure: None. This article was originally published at Insider Monkey.