Before we spend many hours researching a company, we’d like to analyze what hedge funds and billionaire investors think of the stock first. We would like to do so because the elite investors’ consensus returns have been exceptional. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last 12 months ending in October 30. Sixty three percent of these 30 stocks outperformed the market. Although the elite funds occasionally have their duds, such as Micron and Anadarko Petroleum, which fell 50% and 26%, respectively during the same time period, the hedge fund picks seem to work on average. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Ferro Corporation (NYSE:FOE).
Ferro Corporation (NYSE:FOE) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 28 hedge funds’ portfolios at the end of September. At the end of this article we will also compare FOE to other stocks including Linn Energy LLC (NASDAQ:LINE), Cato Corp (NYSE:CATO), and The Andersons, Inc. (NASDAQ:ANDE) to get a better sense of its popularity.
Now, we’re going to review the fresh action encompassing Ferro Corporation (NYSE:FOE).
What does the smart money think about Ferro Corporation (NYSE:FOE)?
Of the funds tracked by Insider Monkey, GAMCO Investors, managed by Mario Gabelli, holds the number one position in Ferro Corporation (NYSE:FOE). GAMCO Investors has a $80.9 million position in the stock, comprising 0.5% of its 13F portfolio. The second largest stake is held by LionEye Capital Management, led by Stephen V. Raneri, holding a $52.8 million position; the fund has 2.2% of its 13F portfolio invested in the stock. Other members of the smart money with similar optimism contain Don Morgan’s Brigade Capital, Stephen Loukas, David A. Lorber, Zachary George’s FrontFour Capital Group and Chuck Royce’s Royce & Associates.
It’s worth mentioning that Daniel Lascano’s Lomas Capital Management dumped the largest stake of all the hedgies watched by Insider Monkey, worth close to $13.4 million in stock. Jim Simons’ fund, Renaissance Technologies, also cut its stock, about $8.2 million worth. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s check out hedge fund activity in other stocks similar to Ferro Corporation (NYSE:FOE). These stocks are Linn Energy LLC (NASDAQ:LINE), Cato Corp (NYSE:CATO), The Andersons, Inc. (NASDAQ:ANDE), and Stewart Information Services Corp (NYSE:STC). This group of stocks’ market values resemble FOE’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 9.5 hedge funds with bullish positions and the average amount invested in these stocks was $94 million. That figure was $283 million in FOE’s case. Stewart Information Services Corp (NYSE:STC) is the most popular stock in this table. On the other hand Linn Energy LLC (NASDAQ:LINE) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Ferro Corporation (NYSE:FOE) 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.