Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Here’s What Hedge Funds Think About Signet Jewelers Limited (SIG)

Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 750 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ recent losses in Facebook. Let’s take a closer look at what the funds we track think about Signet Jewelers Limited (NYSE:SIG) in this article.

Is Signet Jewelers Limited (NYSE:SIG) a buy right now? The best stock pickers are becoming less confident. The number of long hedge fund positions went down by 5 in recent months. Our calculations also showed that sig isn’t among the 30 most popular stocks among hedge funds.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. 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.

Lee Ainslie MAVERICK CAPITAL

We’re going to review the key hedge fund action regarding Signet Jewelers Limited (NYSE:SIG).

How are hedge funds trading Signet Jewelers Limited (NYSE:SIG)?

Heading into the first quarter of 2019, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -19% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards SIG over the last 14 quarters. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).

No of Hedge Funds with SIG Positions

Among these funds, Orbis Investment Management held the most valuable stake in Signet Jewelers Limited (NYSE:SIG), which was worth $137.4 million at the end of the fourth quarter. On the second spot was Select Equity Group which amassed $66.7 million worth of shares. Moreover, Maverick Capital, D E Shaw, and Two Sigma Advisors were also bullish on Signet Jewelers Limited (NYSE:SIG), allocating a large percentage of their portfolios to this stock.

Seeing as Signet Jewelers Limited (NYSE:SIG) has witnessed a decline in interest from hedge fund managers, logic holds that there were a few hedgies who sold off their positions entirely heading into Q3. At the top of the heap, Mark Kingdon’s Kingdon Capital dumped the largest investment of all the hedgies monitored by Insider Monkey, valued at close to $13 million in stock, and David Harding’s Winton Capital Management was right behind this move, as the fund cut about $7.5 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 5 funds heading into Q3.

Let’s now review hedge fund activity in other stocks similar to Signet Jewelers Limited (NYSE:SIG). These stocks are Bloomin’ Brands Inc (NASDAQ:BLMN), Sanmina Corporation (NASDAQ:SANM), NetGear, Inc. (NASDAQ:NTGR), and Aerie Pharmaceuticals Inc (NASDAQ:AERI). All of these stocks’ market caps are closest to SIG’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
BLMN 22 268702 -4
SANM 15 158693 2
NTGR 14 56299 -2
AERI 23 628236 0
Average 18.5 277983 -1

View table here if you experience formatting issues.

As you can see these stocks had an average of 18.5 hedge funds with bullish positions and the average amount invested in these stocks was $278 million. That figure was $200 million in SIG’s case. Aerie Pharmaceuticals Inc (NASDAQ:AERI) is the most popular stock in this table. On the other hand NetGear, Inc. (NASDAQ:NTGR) is the least popular one with only 14 bullish hedge fund positions. Signet Jewelers Limited (NYSE:SIG) 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. 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 SIG wasn’t nearly as popular as these 15 stock and hedge funds that were betting on SIG were disappointed as the stock returned -29.1% 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.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading...