How do we determine whether United Rentals, Inc. (NYSE:URI) makes for a good investment at the moment? We analyze the sentiment of a select group of the very best investors in the world, who spend immense amounts of time and resources studying companies. They may not always be right (no one is), but data shows that their consensus long positions have historically outperformed the market when we adjust for known risk factors.
United Rentals, Inc. (NYSE:URI) investors should be aware of an increase in activity from the world’s largest hedge funds recently. At the end of this article we will also compare URI to other stocks including Tableau Software Inc (NYSE:DATA), Commscope Holding Company Inc (NASDAQ:COMM), and The Valspar Corporation (NYSE:VAL) to get a better sense of its popularity.
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With all of this in mind, let’s view the new action regarding United Rentals, Inc. (NYSE:URI).
How have hedgies been trading United Rentals, Inc. (NYSE:URI)?
Heading into Q4, a total of 52 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 18% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Richard McGuire’s Marcato Capital Management has the most valuable position in United Rentals, Inc. (NYSE:URI), worth close to $121.4 million, corresponding to 6.1% of its total 13F portfolio. The second most bullish fund manager is Iridian Asset Management, managed by David Cohen and Harold Levy, which holds a $92 million position; 0.8% of its 13F portfolio is allocated to the stock. Some other members of the smart money that hold long positions contain Ross Margolies’ Stelliam Investment Management, David Tepper’s Appaloosa Management LP and Paul Reeder and Edward Shapiro’s PAR Capital Management.
As aggregate interest increased, key hedge funds have jumped into United Rentals, Inc. (NYSE:URI) headfirst. Marcato Capital Management, managed by Richard McGuire, assembled the most valuable position in United Rentals, Inc. (NYSE:URI). Marcato Capital Management had $121.4 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also made a $29.3 million investment in the stock during the quarter. The other funds with new positions in the stock are Bill Miller’s Legg Mason Capital Management, Steve Cohen’s Point72 Asset Management, and Clint Murray’s Lodge Hill Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as United Rentals, Inc. (NYSE:URI) but similarly valued. We will take a look at Tableau Software Inc (NYSE:DATA), Commscope Holding Company Inc (NASDAQ:COMM), The Valspar Corporation (NYSE:VAL), and HD Supply Holdings Inc (NASDAQ:HDS). This group of stocks’ market values are closest to URI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DATA | 45 | 1154797 | 6 |
| COMM | 41 | 2006967 | 3 |
| VAL | 19 | 531031 | 0 |
| HDS | 54 | 1273545 | 14 |
As you can see these stocks had an average of 39.75 hedge funds with bullish positions and the average amount invested in these stocks was $1,242 million. That figure was $783 million in URI’s case. HD Supply Holdings Inc (NASDAQ:HDS) is the most popular stock in this table. On the other hand The Valspar Corporation (NYSE:VAL) is the least popular one with only 19 bullish hedge fund positions. United Rentals, Inc. (NYSE:URI) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard HDS might be a better candidate to consider a long position.
