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Here’s What Hedge Funds Are Thinking About American Assets Trust, Inc (AAT)

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 American Assets Trust, Inc (NYSE:AAT)?

Is American Assets Trust, Inc (NYSE:AAT) the right investment to pursue these days? Investors who are in the know are getting more bullish. The number of bullish hedge fund positions advanced by 3 lately. Our calculations also showed that aat isn’t among the 30 most popular stocks among hedge funds. AAT was in 14 hedge funds’ portfolios at the end of December. There were 11 hedge funds in our database with AAT positions at the end of the previous quarter.

So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren’t comfortable with shorting stocks, you should at least avoid initiating long positions in our short portfolio.

Ken Griffin CITADEL INVESTMENT GROUP

We’re going to take a look at the key hedge fund action regarding American Assets Trust, Inc (NYSE:AAT).

What have hedge funds been doing with American Assets Trust, Inc (NYSE:AAT)?

At the end of the fourth quarter, a total of 14 of the hedge funds tracked by Insider Monkey were long this stock, a change of 27% from the second quarter of 2018. The graph below displays the number of hedge funds with bullish position in AAT over the last 14 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

No of Hedge Funds with AAT Positions

Among these funds, AEW Capital Management held the most valuable stake in American Assets Trust, Inc (NYSE:AAT), which was worth $80.5 million at the end of the third quarter. On the second spot was GLG Partners which amassed $10.1 million worth of shares. Moreover, Marshall Wace LLP, Citadel Investment Group, and Millennium Management were also bullish on American Assets Trust, Inc (NYSE:AAT), allocating a large percentage of their portfolios to this stock.

As one would reasonably expect, some big names have jumped into American Assets Trust, Inc (NYSE:AAT) headfirst. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the biggest position in American Assets Trust, Inc (NYSE:AAT). Marshall Wace LLP had $2.6 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also initiated a $1.4 million position during the quarter. The following funds were also among the new AAT investors: Richard Driehaus’s Driehaus Capital and Matthew Hulsizer’s PEAK6 Capital Management.

Let’s now review hedge fund activity in other stocks similar to American Assets Trust, Inc (NYSE:AAT). We will take a look at Clear Channel Outdoor Holdings, Inc. (NYSE:CCO), QTS Realty Trust Inc (NYSE:QTS), Enerplus Corp (NYSE:ERF), and Fabrinet (NYSE:FN). This group of stocks’ market caps match AAT’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CCO 13 70697 0
QTS 16 316250 -3
ERF 18 142066 1
FN 18 127429 3
Average 16.25 164111 0.25

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 $164 million. That figure was $103 million in AAT’s case. Enerplus Corp (NYSE:ERF) is the most popular stock in this table. On the other hand Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) is the least popular one with only 13 bullish hedge fund positions. American Assets Trust, Inc (NYSE:AAT) 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 AAT wasn’t nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); AAT investors were disappointed as the stock returned 9.4% 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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