Between June 25 and October 30th the Russell 2000 ETF (IWM) has lagged the larger S&P 500 ETF (SPY) by more than 14 percentage points as investors worry over the possible ramifications of rising interest rates. The hedge funds and institutional investors, we track typically invest more in small cap stocks than the normal investor, and we have seen data that shows those funds paring back their overall exposure. Those funds cutting positions in small caps is one reason why volatility has increased. In the following paragraphs, we take a closer look at what hedge funds and prominent investors think of Kelly Services, Inc. (NASDAQ:KELYA) and see how the stock is affected by the recent hedge fund activity.
Is Kelly Services, Inc. (NASDAQ:KELYA) the right investment to pursue these days? Hedge funds have taken a bullish view. The number of bullish hedge fund positions rose by 1 recently. Kelly Services, Inc. (NASDAQ:KELYA) was in 10 hedge funds’ portfolios at the end of the third quarter of 2015. There were 9 hedge funds in our database with Kelly Services, Inc. (NASDAQ:KELYA) holdings at the end of the previous quarter. At the end of this article, we will also compare Kelly Services, Inc. (NASDAQ: KELYA) to other stocks, including Diana Shipping Inc. (NYSE:DSX), Alamo Group, Inc. (NYSE:ALG), and CoBiz Financial Inc (NASDAQ:COBZ) to get a better sense of its popularity.
In today’s marketplace there are several tools shareholders use to assess stocks. A duo of the most underrated tools are hedge fund and insider trading moves. Our experts have shown that, historically, those who follow the top picks of the best hedge fund managers can outclass the market by a healthy margin (see the details here).
With all of this in mind, let’s take a gander at the key action encompassing Kelly Services, Inc. (NASDAQ:KELYA).
What does the smart money think about Kelly Services, Inc. (NASDAQ:KELYA)?
At the end of Q3, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 11% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Royce & Associates, mutual fund managed by Chuck Royce, holds the largest position in Kelly Services, Inc. (NASDAQ:KELYA). Royce & Associates has a $16.5 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Lee Munder of Lee Munder Capital Group, with a $8.7 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Hedge funds and other institutional investors that hold long positions include Roger Ibbotson’s Zebra Capital Management, Matthew Hulsizer’s PEAK6 Capital Management and Israel Englander’s Millennium Management.
Several hedge funds have jumped into Kelly Services, Inc. (NASDAQ:KELYA) headfirst. PDT Partners, managed by Peter Muller, established the largest position in Kelly Services, Inc. (NASDAQ:KELYA). PDT Partners had $0.2 million invested in the company at the end of the quarter. Chao Ku’s Nine Chapters Capital Management also initiated a $0.1 million position during the quarter. The only other fund with a new position in the stock is Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
Let’s go over hedge fund activity in other stocks similar to Kelly Services, Inc. (NASDAQ:KELYA). These stocks are Diana Shipping Inc. (NYSE:DSX), Alamo Group, Inc. (NYSE:ALG), CoBiz Financial Inc (NASDAQ:COBZ), and Frontline Ltd (NYSE:FRO). This group of stocks’ market valuations is closest to Kelly Services, Inc. (NASDAQ:KELYA)’s market valuation.
|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 9.75 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was $27 million in Kelly Services, Inc. (NASDAQ:KELYA)’s case. Frontline Ltd (NYSE:FRO) is the most popular stock in this table. On the other hand, CoBiz Financial Inc (NASDAQ:COBZ) is the least popular one with only 6 bullish hedge fund positions. Kelly Services, Inc. (NASDAQ: KELYA) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal but in light of the fact that hedge funds aren’t as long Kelly Services in aggregate as they are other comparable stocks, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard Frontline Ltd (NYSE:FRO) might be a better candidate to do research on.