Here’s What Hedge Funds Think About Lindsay Corporation (LNN)

The Insider Monkey team has completed processing the quarterly 13F filings for the December quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors endured a torrid quarter, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Lindsay Corporation (NYSE:LNN).

Lindsay Corporation (NYSE:LNN) shareholders have witnessed an increase in hedge fund sentiment recently. LNN was in 11 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 8 hedge funds in our database with LNN positions at the end of the previous quarter. Our calculations also showed that lnn isn’t among the 30 most popular stocks among hedge funds.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were 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’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Mario Gabelli with cereal box

Let’s take a gander at the latest hedge fund action encompassing Lindsay Corporation (NYSE:LNN).

How are hedge funds trading Lindsay Corporation (NYSE:LNN)?

At Q4’s end, a total of 11 of the hedge funds tracked by Insider Monkey were long this stock, a change of 38% from one quarter earlier. On the other hand, there were a total of 8 hedge funds with a bullish position in LNN a year ago. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).

No of Hedge Funds with LNN Positions

The largest stake in Lindsay Corporation (NYSE:LNN) was held by Royce & Associates, which reported holding $92.1 million worth of stock at the end of December. It was followed by Impax Asset Management with a $61.7 million position. Other investors bullish on the company included Renaissance Technologies, GAMCO Investors, and Citadel Investment Group.

As one would reasonably expect, some big names were leading the bulls’ herd. Two Sigma Advisors, managed by John Overdeck and David Siegel, created the most valuable position in Lindsay Corporation (NYSE:LNN). Two Sigma Advisors had $0.5 million invested in the company at the end of the quarter. Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital also made a $0.4 million investment in the stock during the quarter. The only other fund with a brand new LNN position is Matthew Hulsizer’s PEAK6 Capital Management.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Lindsay Corporation (NYSE:LNN) but similarly valued. We will take a look at Carrizo Oil & Gas, Inc. (NASDAQ:CRZO), ProPetro Holding Corp. (NYSE:PUMP), Luminex Corporation (NASDAQ:LMNX), and Celestica Inc. (NYSE:CLS). This group of stocks’ market caps match LNN’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CRZO 13 65343 -5
PUMP 20 160260 -1
LMNX 19 175259 3
CLS 14 100130 -3
Average 16.5 125248 -1.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 16.5 hedge funds with bullish positions and the average amount invested in these stocks was $125 million. That figure was $214 million in LNN’s case. ProPetro Holding Corp. (NYSE:PUMP) is the most popular stock in this table. On the other hand Carrizo Oil & Gas, Inc. (NASDAQ:CRZO) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks Lindsay Corporation (NYSE:LNN) is even less popular than CRZO. Hedge funds dodged a bullet by taking a bearish stance towards LNN. Our calculations showed that the top 15 most popular hedge fund stocks returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately LNN wasn’t nearly as popular as these 15 stock (hedge fund sentiment was very bearish); LNN investors were disappointed as the stock returned -10.6% 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.