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Is Camden Property Trust (CPT) A Good Stock To Buy?

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’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Camden Property Trust (NYSE:CPT) in this article.

Camden Property Trust (NYSE:CPT) has seen an increase in activity from the world’s largest hedge funds of late. CPT was in 20 hedge funds’ portfolios at the end of September. There were 19 hedge funds in our database with CPT holdings at the end of the previous quarter. Our calculations also showed that CPT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
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 the average investor there are a large number of metrics shareholders put to use to size up publicly traded companies. A pair of the most innovative metrics are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the top picks of the elite investment managers can outpace the S&P 500 by a healthy margin (see the details here).

Phill Gross of Adage Capital Management

Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world’s most bearish hedge fund that’s more convinced than ever that a crash is coming, our long-short investment strategy doesn’t rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds‘ buy/sell signals. We’re going to take a peek at the fresh hedge fund action surrounding Camden Property Trust (NYSE:CPT).

How have hedgies been trading Camden Property Trust (NYSE:CPT)?

At Q3’s end, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of 5% from the previous quarter. By comparison, 14 hedge funds held shares or bullish call options in CPT a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Camden Property Trust (NYSE:CPT) was held by Millennium Management, which reported holding $101.6 million worth of stock at the end of September. It was followed by Citadel Investment Group with a $52.3 million position. Other investors bullish on the company included Winton Capital Management, Balyasny Asset Management, and AQR Capital Management. In terms of the portfolio weights assigned to each position Winton Capital Management allocated the biggest weight to Camden Property Trust (NYSE:CPT), around 0.58% of its 13F portfolio. Carlson Capital is also relatively very bullish on the stock, dishing out 0.25 percent of its 13F equity portfolio to CPT.

As aggregate interest increased, key money managers have jumped into Camden Property Trust (NYSE:CPT) headfirst. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the most valuable position in Camden Property Trust (NYSE:CPT). Adage Capital Management had $7.7 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace also made a $6.6 million investment in the stock during the quarter. The following funds were also among the new CPT investors: Benjamin A. Smith’s Laurion Capital Management, Michael Gelband’s ExodusPoint Capital, and Steve Cohen’s Point72 Asset Management.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Camden Property Trust (NYSE:CPT) but similarly valued. These stocks are Noble Energy, Inc. (NYSE:NBL), CF Industries Holdings, Inc. (NYSE:CF), Sasol Limited (NYSE:SSL), and Lamb Weston Holdings, Inc. (NYSE:LW). This group of stocks’ market caps are closest to CPT’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NBL 28 602859 3
CF 39 956283 4
SSL 8 26026 0
LW 33 438896 4
Average 27 506016 2.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 27 hedge funds with bullish positions and the average amount invested in these stocks was $506 million. That figure was $316 million in CPT’s case. CF Industries Holdings, Inc. (NYSE:CF) is the most popular stock in this table. On the other hand Sasol Limited (NYSE:SSL) is the least popular one with only 8 bullish hedge fund positions. Camden Property Trust (NYSE:CPT) 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 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately CPT wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); CPT investors were disappointed as the stock returned 0.5% during the first two months of the fourth quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market in Q4.

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

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