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Here is What Hedge Funds Think About Trinseo S.A. (TSE)

Insider Monkey finished processing more than 700 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of December 31st, 2018. What do these smart investors think about Trinseo S.A. (NYSE:TSE)?

Is Trinseo S.A. (NYSE:TSE) a buy, sell, or hold? Investors who are in the know are becoming less hopeful. The number of long hedge fund bets retreated by 2 recently. Our calculations also showed that tse isn’t among the 30 most popular stocks among hedge funds. TSE was in 16 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 18 hedge funds in our database with TSE positions at the end of the previous quarter.

According to most shareholders, hedge funds are assumed to be underperforming, old investment vehicles of years past. While there are more than 8000 funds with their doors open today, Our researchers look at the top tier of this club, approximately 750 funds. These money managers have their hands on bulk of the hedge fund industry’s total capital, and by paying attention to their top picks, Insider Monkey has deciphered a few investment strategies that have historically outrun the broader indices. Insider Monkey’s flagship hedge fund strategy outperformed the S&P 500 index by nearly 5 percentage points a year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 27.5% since February 2017 (through March 12th) even though the market was up nearly 25% during the same period. We just shared a list of 6 short targets in our latest quarterly update and they are already down an average of 6% in less than a month.

John Overdeck of Two Sigma

We’re going to go over the recent hedge fund action surrounding Trinseo S.A. (NYSE:TSE).

How have hedgies been trading Trinseo S.A. (NYSE:TSE)?

At Q4’s end, a total of 16 of the hedge funds tracked by Insider Monkey were long this stock, a change of -11% from one quarter earlier. On the other hand, there were a total of 18 hedge funds with a bullish position in TSE a year ago. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).

No of Hedge Funds with TSE Positions

The largest stake in Trinseo S.A. (NYSE:TSE) was held by Renaissance Technologies, which reported holding $51.6 million worth of stock at the end of September. It was followed by GLG Partners with a $9.7 million position. Other investors bullish on the company included AQR Capital Management, Citadel Investment Group, and Two Sigma Advisors.

Judging by the fact that Trinseo S.A. (NYSE:TSE) has experienced a decline in interest from the aggregate hedge fund industry, we can see that there is a sect of funds that decided to sell off their positions entirely heading into Q3. At the top of the heap, Dmitry Balyasny’s Balyasny Asset Management sold off the largest position of the “upper crust” of funds monitored by Insider Monkey, worth close to $6.3 million in stock, and David Costen Haley’s HBK Investments was right behind this move, as the fund said goodbye to about $2.7 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 2 funds heading into Q3.

Let’s now review hedge fund activity in other stocks similar to Trinseo S.A. (NYSE:TSE). We will take a look at Xenia Hotels & Resorts Inc (NYSE:XHR), International Speedway Corporation (NASDAQ:ISCA), Upwork Inc. (NASDAQ:UPWK), and Arena Pharmaceuticals, Inc. (NASDAQ:ARNA). This group of stocks’ market caps are similar to TSE’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
XHR 13 66463 4
ISCA 20 137886 3
UPWK 7 27815 7
ARNA 25 354292 0
Average 16.25 146614 3.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 16.25 hedge funds with bullish positions and the average amount invested in these stocks was $147 million. That figure was $97 million in TSE’s case. Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) is the most popular stock in this table. On the other hand Upwork Inc. (NASDAQ:UPWK) is the least popular one with only 7 bullish hedge fund positions. Trinseo S.A. (NYSE:TSE) is not the least popular stock in this group but 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. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately TSE wasn’t nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); TSE investors were disappointed as the stock returned 5.5% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.

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

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