Is Costamare Inc (CMRE) A Good Stock To Buy?

Billionaire hedge fund managers such as Steve Cohen and Stan Druckenmiller can generate millions or even billions of dollars every year by pinning down high-potential small-cap stocks and pouring cash into these candidates. Small-cap stocks are overlooked by most investors, brokerage houses, and financial services hubs, while the unlimited research abilities of the big players within the hedge fund industry can easily identify the undervalued and high-potential stocks that reside the ignored corners of equity markets. There are numerous small-cap stocks that have turned out to be great winners, which is one of the main reasons the Insider Monkey team pays close attention to the hedge fund activity in relation to these stocks.

Costamare Inc (NYSE:CMRE) was in 11 hedge funds’ portfolios at the end of September. CMRE investors should pay attention to an increase in activity from the world’s largest hedge funds in recent months. There were 7 hedge funds in our database with CMRE positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as The Marcus Corporation (NYSE:MCS), National Bank Holdings Corp (NYSE:NBHC), and Customers Bancorp Inc (NASDAQ:CUBI) to gather more data points.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

Now, let’s take a look at the key action regarding Costamare Inc (NYSE:CMRE).

How have hedgies been trading Costamare Inc (NYSE:CMRE)?

Heading into the fourth quarter of 2016, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, a rise of 57% from the second quarter of 2016. The graph below displays the number of hedge funds with bullish position in CMRE over the last 5 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, York Capital Management, led by James Dinan, holds the number one position in Costamare Inc (NYSE:CMRE). York Capital Management has a $10.5 million position in the stock. On York Capital Management’s heels is Selz Capital, led by Bernard Selz, which holds a $6.2 million position; 1.5% of its 13F portfolio is allocated to the stock. Other peers that hold long positions contain John Overdeck and David Siegel’s Two Sigma Advisors, Murray Stahl’s Horizon Asset Management and Neil Chriss’ Hutchin Hill Capital. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

With a general bullishness amongst the heavyweights, key money managers have jumped into Costamare Inc (NYSE:CMRE) headfirst. Highbridge Capital Management, led by Glenn Russell Dubin, established the most outsized position in Costamare Inc (NYSE:CMRE). Highbridge Capital Management had $0.5 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also made a $0.4 million investment in the stock during the quarter. The other funds with brand new CMRE positions are Peter Algert and Kevin Coldiron’s Algert Coldiron Investors, George Hall’s Clinton Group, and Roger Ibbotson’s Zebra Capital Management.

Let’s now review hedge fund activity in other stocks similar to Costamare Inc (NYSE:CMRE). These stocks are The Marcus Corporation (NYSE:MCS), National Bank Holdings Corp (NYSE:NBHC), Customers Bancorp Inc (NASDAQ:CUBI), and PROS Holdings, Inc. (NYSE:PRO). This group of stocks’ market values resemble CMRE’s market value.

As you can see these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $50 million. That figure was $22 million in CMRE’s case. National Bank Holdings Corp (NYSE:NBHC) is the most popular stock in this table. On the other hand PROS Holdings, Inc. (NYSE:PRO) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Costamare Inc (NYSE:CMRE) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

Disclosure: None