Is Granite Construction Incorporated (GVA) A Good Stock To Buy ?

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended March 31, so let’s proceed with the discussion of the hedge fund sentiment on Granite Construction Incorporated (NYSE:GVA).

Is Granite Construction Incorporated (NYSE:GVA) a healthy stock for your portfolio? The smart money is in a bullish mood. The number of bullish hedge fund positions moved up by 4 recently. Our calculations also showed that gva isn’t among the 30 most popular stocks among hedge funds. GVA was in 15 hedge funds’ portfolios at the end of the first quarter of 2019. There were 11 hedge funds in our database with GVA positions at the end of the previous quarter.

To most traders, hedge funds are assumed to be underperforming, outdated investment tools of years past. While there are over 8000 funds in operation at the moment, Our experts hone in on the leaders of this group, approximately 750 funds. Most estimates calculate that this group of people shepherd most of all hedge funds’ total capital, and by keeping track of their best picks, Insider Monkey has found a few investment strategies that have historically outstripped the S&P 500 index. Insider Monkey’s flagship hedge fund strategy outpaced the S&P 500 index by around 5 percentage points a year since its inception in May 2014 through June 18th. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 28.2% since February 2017 (through June 18th) even though the market was up nearly 30% during the same period. We just shared a list of 5 short targets in our latest quarterly update and they are already down an average of 8.2% in a month whereas our long picks outperformed the market by 2.5 percentage points in this volatile 5 week period (our long picks also beat the market by 15 percentage points so far this year).

Dmitry Balyasny

Let’s take a look at the key hedge fund action regarding Granite Construction Incorporated (NYSE:GVA).

How are hedge funds trading Granite Construction Incorporated (NYSE:GVA)?

At Q1’s end, a total of 15 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 36% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards GVA over the last 15 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.

No of Hedge Funds with GVA Positions

Among these funds, Royce & Associates held the most valuable stake in Granite Construction Incorporated (NYSE:GVA), which was worth $20.4 million at the end of the first quarter. On the second spot was Renaissance Technologies which amassed $14.1 million worth of shares. Moreover, Rutabaga Capital Management, Headlands Capital, and Balyasny Asset Management were also bullish on Granite Construction Incorporated (NYSE:GVA), allocating a large percentage of their portfolios to this stock.

With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Millennium Management, managed by Israel Englander, established the largest position in Granite Construction Incorporated (NYSE:GVA). Millennium Management had $1.4 million invested in the company at the end of the quarter. Matthew Tewksbury’s Stevens Capital Management also initiated a $1.2 million position during the quarter. The other funds with new positions in the stock are Paul Marshall and Ian Wace’s Marshall Wace LLP, Ken Griffin’s Citadel Investment Group, and Thomas Bailard’s Bailard Inc.

Let’s check out hedge fund activity in other stocks similar to Granite Construction Incorporated (NYSE:GVA). These stocks are Colony Credit Real Estate, Inc. (NYSE:CLNC), Evertec Inc (NYSE:EVTC), Gray Television, Inc. (NYSE:GTN), and Enerplus Corp (NYSE:ERF). This group of stocks’ market caps resemble GVA’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CLNC 6 19319 -1
EVTC 21 267101 0
GTN 27 303277 1
ERF 21 160880 3
Average 18.75 187644 0.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 18.75 hedge funds with bullish positions and the average amount invested in these stocks was $188 million. That figure was $85 million in GVA’s case. Gray Television, Inc. (NYSE:GTN) is the most popular stock in this table. On the other hand Colony Credit Real Estate, Inc. (NYSE:CLNC) is the least popular one with only 6 bullish hedge fund positions. Granite Construction Incorporated (NYSE:GVA) is not the least popular stock in this group but hedge fund interest is still below average. 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. A small number of hedge funds were also right about betting on GVA, though not to the same extent, as the stock returned 3.9% during the same time frame and outperformed the market as well.

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