Here is What Hedge Funds Think About Cooper Tire & Rubber Company (CTB)

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. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. What do these smart investors think about Cooper Tire & Rubber Company (NYSE:CTB)?

Cooper Tire & Rubber Company (NYSE:CTB) was in 20 hedge funds’ portfolios at the end of March. CTB has seen an increase in hedge fund interest in recent months. There were 17 hedge funds in our database with CTB holdings at the end of the previous quarter. Our calculations also showed that CTB 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.

Today there are many indicators shareholders can use to value stocks. Some of the most innovative indicators are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the top picks of the elite hedge fund managers can outperform the market by a superb margin (see the details here).

We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. 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 analyze the recent hedge fund action surrounding Cooper Tire & Rubber Company (NYSE:CTB).

How have hedgies been trading Cooper Tire & Rubber Company (NYSE:CTB)?

Heading into the second quarter of 2020, a total of 20 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 18% from the previous quarter. By comparison, 17 hedge funds held shares or bullish call options in CTB a year ago. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings considerably (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Chuck Royce’s Royce & Associates has the biggest position in Cooper Tire & Rubber Company (NYSE:CTB), worth close to $26.6 million, accounting for 0.4% of its total 13F portfolio. On Royce & Associates’s heels is Point72 Asset Management, led by Steve Cohen, holding a $11.5 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors that are bullish comprise Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Michael Cowley’s Sandbar Asset Management and D. E. Shaw’s D E Shaw. In terms of the portfolio weights assigned to each position Sandbar Asset Management allocated the biggest weight to Cooper Tire & Rubber Company (NYSE:CTB), around 4.38% of its 13F portfolio. Rutabaga Capital Management is also relatively very bullish on the stock, setting aside 2.48 percent of its 13F equity portfolio to CTB.

Now, key money managers have jumped into Cooper Tire & Rubber Company (NYSE:CTB) headfirst. Sandbar Asset Management, managed by Michael Cowley, created the most valuable position in Cooper Tire & Rubber Company (NYSE:CTB). Sandbar Asset Management had $6.4 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also made a $2.5 million investment in the stock during the quarter. The other funds with brand new CTB positions are Mike Vranos’s Ellington, Benjamin A. Smith’s Laurion Capital Management, and Joel Greenblatt’s Gotham Asset Management.

Let’s go over hedge fund activity in other stocks similar to Cooper Tire & Rubber Company (NYSE:CTB). These stocks are Aphria Inc. (NASDAQ:APHA), Veoneer, Inc. (NYSE:VNE), Independence Realty Trust Inc (NYSE:IRT), and EnPro Industries, Inc. (NYSE:NPO). All of these stocks’ market caps are similar to CTB’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 12.5 hedge funds with bullish positions and the average amount invested in these stocks was $68 million. That figure was $84 million in CTB’s case. Independence Realty Trust Inc (NYSE:IRT) is the most popular stock in this table. On the other hand Aphria Inc. (NASDAQ:APHA) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks Cooper Tire & Rubber Company (NYSE:CTB) 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 12.2% in 2020 through June 17th but still managed to beat the market by 14.8 percentage points. Hedge funds were also right about betting on CTB as the stock returned 62.8% so far in Q2 (through June 17th) 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.