Is Grupo Financiero Galicia S.A. (ADR) (GGAL) Worthy of Your Portfolio?

The 700+ hedge funds and money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund positions. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL).

Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL) investors should be aware of an increase in support from the world’s most successful money managers of late. There were 16 hedge funds in our database with GGAL positions at the end of September, up by two funds over the quarter. However, 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 Brink’S Co (NYSE:BCO), Federal-Mogul Corporation (NASDAQ:FDML), and Waddell & Reed Financial, Inc. (NYSE:WDR) 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, we’re going to review the fresh action surrounding Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL).

What does the smart money think about Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL)?

Heading into the fourth quarter of 2016, 16 funds tracked by Insider Monkey were long Grupo Financiero Galicia, which represents an increase of 14% from the second quarter of 2016. By comparison, eight funds held shares or bullish call options in GGAL heading into this year. So, let’s examine 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, Zach Schreiber’s Point State Capital has the number one position in Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL), worth close to $50.9 million, accounting for 0.5% of its total 13F portfolio. Sitting at the No. 2 spot is EMS Capital, led by Edmond M. Safra, which holds a $29.8 million position; the fund has 3% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions comprise Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Bruce Kovner’s Caxton Associates LP, and Crispin Odey’s Odey Asset Management Group. 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.

Now, key hedge funds have jumped into Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL) headfirst. RIT Capital Partners, led by Jacob Rothschild, established the largest position in Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL). RIT Capital Partners had $3.3 million invested in the company at the end of the quarter. George Soros’ Soros Fund Management also initiated a $2.2 million position during the third quarter. The other funds with brand new GGAL positions are Ken Griffin’s Citadel Investment Group, John Burbank’s Passport Capital, and Mike Vranos’s Ellington.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL) but similarly valued. We will take a look at Brink’S Co (NYSE:BCO), Federal-Mogul Corporation (NASDAQ:FDML), Waddell & Reed Financial, Inc. (NYSE:WDR), and MRC Global Inc (NYSE:MRC). This group of stocks’ market caps are closest to GGAL’s market cap.

As you can see these stocks had an average of 17 funds with bullish positions and the average amount invested in these stocks was $550 million. That figure was $151 million in GGAL’s case. Brink’S Co (NYSE:BCO) is the most popular stock in this table. On the other hand Federal-Mogul Corporation (NASDAQ:FDML) is the least popular one with only eight investors holding shares. Grupo Financiero Galicia S.A. (ADR) (NASDAQ:GGAL) 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. In this regard Brink’S Co (NYSE:BCO) might be a better candidate to consider taking a long position in.

Disclosure: none