The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their December 31 holdings, data that is available nowhere else. Should you consider Unitil Corporation (NYSE:UTL) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Unitil Corporation (NYSE:UTL) was in 8 hedge funds’ portfolios at the end of December. UTL has experienced a decrease in enthusiasm from smart money lately. There were 10 hedge funds in our database with UTL holdings at the end of the previous quarter. Our calculations also showed that UTL isn’t among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to view the latest hedge fund action regarding Unitil Corporation (NYSE:UTL).
What does the smart money think about Unitil Corporation (NYSE:UTL)?
At Q4’s end, a total of 8 of the hedge funds tracked by Insider Monkey were long this stock, a change of -20% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in UTL over the last 14 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Jim Simons’s Renaissance Technologies has the biggest position in Unitil Corporation (NYSE:UTL), worth close to $43.1 million, comprising less than 0.1%% of its total 13F portfolio. The second most bullish fund manager is Impax Asset Management, led by Ian Simm, holding a $26.5 million position; 0.4% of its 13F portfolio is allocated to the company. Other members of the smart money that are bullish consist of Phill Gross and Robert Atchinson’s Adage Capital Management, Noam Gottesman’s GLG Partners and Cliff Asness’s AQR Capital Management.
Because Unitil Corporation (NYSE:UTL) has witnessed a decline in interest from the aggregate hedge fund industry, it’s safe to say that there were a few hedge funds that slashed their entire stakes by the end of the third quarter. Interestingly, Israel Englander’s Millennium Management cut the largest investment of the “upper crust” of funds followed by Insider Monkey, worth close to $1 million in stock, and Ken Griffin’s Citadel Investment Group was right behind this move, as the fund sold off about $0.4 million worth. These transactions are interesting, as total hedge fund interest dropped by 2 funds by the end of the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Unitil Corporation (NYSE:UTL) but similarly valued. We will take a look at Radius Health Inc (NASDAQ:RDUS), Regis Corporation (NYSE:RGS), Tekla Healthcare Investors (NYSE:HQH), and United Financial Bancorp, Inc. (NASDAQ:UBNK). This group of stocks’ market valuations resemble UTL’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $142 million. That figure was $96 million in UTL’s case. Radius Health Inc (NASDAQ:RDUS) is the most popular stock in this table. On the other hand Tekla Healthcare Investors (NYSE:HQH) is the least popular one with only 3 bullish hedge fund positions. Unitil Corporation (NYSE:UTL) 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 UTL wasn’t nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); UTL investors were disappointed as the stock returned 6.7% 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.