Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Micron and Anadarko Petroleum, have not done well during the last 12 months ending in October due to various reasons. Nevertheless, the data show elite investors’ consensus picks have done well on average. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last four quarters ending in October and sixty three percent of these 30 stocks outperformed the market. S&P 500 Index returned only 5.2% during the same period and less than 49% of its constituents managed to beat this return. Because their consensus picks have done well, we pay attention to what elite funds think before doing extensive research on a stock. In this article, we take a closer look at Luxfer Holdings PLC (NYSE:LXFR) from the perspective of those elite funds.
Luxfer Holdings PLC investors should be aware of an increase in enthusiasm from smart money in recent months. At the end of this article we will also compare LXFR to other stocks, including Threshold Pharmaceuticals, Inc. (NASDAQ:THLD), Meta Financial Group Inc. (NASDAQ:CASH), and Asanko Gold Inc (NYSEMKT:AKG) to get a better sense of its popularity.
Today there are a lot of gauges shareholders have at their disposal to assess their holdings. A duo of the less known gauges are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the best picks of the elite investment managers can outpace the broader indices by a very impressive amount (see the details here).
With all of this in mind, we’re going to take a glance at the recent action encompassing Luxfer Holdings PLC (ADR) (NYSE:LXFR).
What have hedge funds been doing with Luxfer Holdings PLC (ADR) (NYSE:LXFR)?
Heading into Q4, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 29% from the previous quarter. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, GMT Capital, managed by Thomas E. Claugus, holds the most valuable position in Luxfer Holdings PLC (ADR) (NYSE:LXFR). GMT Capital has a $28.7 million position in the stock, comprising 0.7% of its 13F portfolio. The second largest stake is held by Archer Capital Management, managed by Eric Edidin and Josh Lobel, which holds a $27.3 million position; 3.9% of its 13F portfolio is allocated to the stock. Some other hedge funds and institutional investors that are bullish contain Jonathan Savitz’s Greywolf Capital Management, Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management and Matthew Barrett’s Glendon Capital Management.
As one would reasonably expect, specific money managers have jumped into Luxfer Holdings PLC (ADR) (NYSE:LXFR) headfirst. Nantahala Capital Management assembled the most valuable position in Luxfer Holdings PLC (ADR) (NYSE:LXFR). Nantahala Capital Management had $6.2 million invested in the company at the end of the quarter. Chao Ku’s Nine Chapters Capital Management also initiated a $0.1 million position during the quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Luxfer Holdings PLC (ADR) (NYSE:LXFR) but similarly valued. We will take a look at Threshold Pharmaceuticals, Inc. (NASDAQ:THLD), Meta Financial Group Inc. (NASDAQ:CASH), Asanko Gold Inc (NYSEMKT:AKG), and Sodastream International Ltd (NASDAQ:SODA). This group of stocks’ market valuations are similar to LXFR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| THLD | 13 | 31728 | 4 |
| CASH | 15 | 65518 | 3 |
| AKG | 5 | 28173 | 0 |
| SODA | 11 | 39221 | 2 |
As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $41 million, below the $84 million figure in LXFR’s case. Meta Financial Group Inc. (NASDAQ:CASH) is the most popular stock in this table. On the other hand Asanko Gold Inc (NYSEMKT:AKG) is the least popular one with only five bullish hedge fund positions. Even though Luxfer Holdings PLC (ADR) (NYSE:LXFR) is not the least popular stock in this group, the hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on, such as CASH, which might be a better candidate to consider a long position.
