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 March 31 holdings, data that is available nowhere else. Should you consider Corporacion America Airports SA (NYSE:CAAP) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Corporacion America Airports SA (NYSE:CAAP) was in 12 hedge funds’ portfolios at the end of March. CAAP shareholders have witnessed a decrease in hedge fund interest lately. There were 13 hedge funds in our database with CAAP positions at the end of the previous quarter. Our calculations also showed that CAAP 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’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We’re going to check out the fresh hedge fund action regarding Corporacion America Airports SA (NYSE:CAAP).
Hedge fund activity in Corporacion America Airports SA (NYSE:CAAP)
At the end of the first quarter, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -8% from the previous quarter. The graph below displays the number of hedge funds with bullish position in CAAP over the last 15 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
More specifically, Key Square Capital Management was the largest shareholder of Corporacion America Airports SA (NYSE:CAAP), with a stake worth $14.2 million reported as of the end of March. Trailing Key Square Capital Management was Makaira Partners, which amassed a stake valued at $12 million. Highland Capital Management, Newtyn Management, and Sloane Robinson Investment Management were also very fond of the stock, giving the stock large weights in their portfolios.
Because Corporacion America Airports SA (NYSE:CAAP) has faced bearish sentiment from the smart money, we can see that there is a sect of money managers who were dropping their positions entirely in the third quarter. It’s worth mentioning that Bruce J. Richards and Louis Hanover’s Marathon Asset Management dumped the biggest position of all the hedgies monitored by Insider Monkey, comprising an estimated $1.4 million in stock, and Jody LaNasa’s Serengeti Asset Management was right behind this move, as the fund cut about $1.3 million worth. These transactions are intriguing to say the least, as total hedge fund interest fell by 1 funds in the third quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Corporacion America Airports SA (NYSE:CAAP) but similarly valued. We will take a look at Veritex Holdings Inc (NASDAQ:VBTX), Employers Holdings, Inc. (NYSE:EIG), Waddell & Reed Financial, Inc. (NYSE:WDR), and CareDx, Inc. (NASDAQ:CDNA). All of these stocks’ market caps resemble CAAP’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| VBTX | 11 | 86806 | 3 |
| EIG | 17 | 72243 | -1 |
| WDR | 18 | 110112 | 2 |
| CDNA | 25 | 139854 | 3 |
| Average | 17.75 | 102254 | 1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.75 hedge funds with bullish positions and the average amount invested in these stocks was $102 million. That figure was $58 million in CAAP’s case. CareDx, Inc. (NASDAQ:CDNA) is the most popular stock in this table. On the other hand Veritex Holdings Inc (NASDAQ:VBTX) is the least popular one with only 11 bullish hedge fund positions. Corporacion America Airports SA (NYSE:CAAP) 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 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately CAAP wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); CAAP investors were disappointed as the stock returned -3.1% during the same time period 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 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.
