Is Buckeye Partners, L.P. (BPL) Going to Burn These Hedge Funds?

We are still in an overall bull market and many stocks that smart money investors were piling into surged through October 17th. Among them, Facebook and Microsoft ranked among the top 3 picks and these stocks gained 45% and 39% respectively. Hedge funds’ top 3 stock picks returned 34.4% this year and beat the S&P 500 ETFs by 13 percentage points. Investing in index funds guarantees you average returns, not superior returns. We are looking to generate superior returns for our readers. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Buckeye Partners, L.P. (NYSE:BPL).

Buckeye Partners, L.P. (NYSE:BPL) has experienced an increase in hedge fund sentiment recently. BPL was in 13 hedge funds’ portfolios at the end of the second quarter of 2019. There were 5 hedge funds in our database with BPL holdings at the end of the previous quarter. Our calculations also showed that BPL isn’t among the 30 most popular stocks among hedge funds (view the video below).
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

To most stock holders, hedge funds are seen as worthless, outdated financial vehicles of years past. While there are over 8000 funds in operation at present, We hone in on the bigwigs of this group, around 750 funds. These money managers administer the majority of the smart money’s total capital, and by following their matchless equity investments, Insider Monkey has come up with a number of investment strategies that have historically outpaced the market. Insider Monkey’s flagship hedge fund strategy outstripped the S&P 500 index by around 5 percentage points per annum since its inception in May 2014. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 25.7% since February 2017 (through September 30th) even though the market was up more than 33% during the same period. We just shared a list of 10 short targets in our latest quarterly update .

David Witkin Beryl Capital

Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. We’re going to go over the latest hedge fund action surrounding Buckeye Partners, L.P. (NYSE:BPL).

What have hedge funds been doing with Buckeye Partners, L.P. (NYSE:BPL)?

At Q2’s end, a total of 13 of the hedge funds tracked by Insider Monkey were long this stock, a change of 160% from the first quarter of 2019. Below, you can check out the change in hedge fund sentiment towards BPL over the last 16 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.


Among these funds, Water Island Capital held the most valuable stake in Buckeye Partners, L.P. (NYSE:BPL), which was worth $30.4 million at the end of the second quarter. On the second spot was Maso Capital which amassed $26.8 million worth of shares. Moreover, LMR Partners, Beryl Capital Management, and Perella Weinberg Partners were also bullish on Buckeye Partners, L.P. (NYSE:BPL), allocating a large percentage of their portfolios to this stock.

Now, key hedge funds were leading the bulls’ herd. Water Island Capital, managed by John Orrico, established the most valuable position in Buckeye Partners, L.P. (NYSE:BPL). Water Island Capital had $30.4 million invested in the company at the end of the quarter. Manoj JaináandáSohit Khurana’s Maso Capital also initiated a $26.8 million position during the quarter. The other funds with new positions in the stock are Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners, David Alexander Witkin’s Beryl Capital Management, and Perella Weinberg Partners.

Let’s also examine hedge fund activity in other stocks similar to Buckeye Partners, L.P. (NYSE:BPL). We will take a look at Sonoco Products Company (NYSE:SON), Logitech International SA (NASDAQ:LOGI), ANGI Homeservices Inc. (NASDAQ:ANGI), and GCI Liberty, Inc. (NASDAQ:GLIBA). This group of stocks’ market valuations are similar to BPL’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
SON 19 122266 2
LOGI 16 207640 1
ANGI 20 206353 -2
GLIBA 38 2029549 2
Average 23.25 641452 0.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 23.25 hedge funds with bullish positions and the average amount invested in these stocks was $641 million. That figure was $166 million in BPL’s case. GCI Liberty, Inc. (NASDAQ:GLIBA) is the most popular stock in this table. On the other hand Logitech International SA (NASDAQ:LOGI) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks Buckeye Partners, L.P. (NYSE:BPL) is even less popular than LOGI. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. A small number of hedge funds were also right about betting on BPL, though not to the same extent, as the stock returned 1.9% during the third quarter and outperformed the market as well.

Disclosure: None. This article was originally published at Insider Monkey.