The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 817 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider NACCO Industries, Inc. (NYSE:NC) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is NACCO Industries, Inc. (NYSE:NC) the right pick for your portfolio? Hedge funds were getting less bullish. The number of bullish hedge fund positions decreased by 1 recently. NACCO Industries, Inc. (NYSE:NC) was in 4 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistics is 11. Our calculations also showed that NC isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks). There were 5 hedge funds in our database with NC holdings at the end of June.
Video: Watch our video about the top 5 most popular hedge fund stocks.
If you’d ask most stock holders, hedge funds are perceived as unimportant, old investment vehicles of the past. While there are greater than 8000 funds trading today, We look at the elite of this club, about 850 funds. Most estimates calculate that this group of people have their hands on the lion’s share of all hedge funds’ total capital, and by observing their first-class equity investments, Insider Monkey has come up with various investment strategies that have historically outrun Mr. Market. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now we’re going to check out the fresh hedge fund action surrounding NACCO Industries, Inc. (NYSE:NC).
How have hedgies been trading NACCO Industries, Inc. (NYSE:NC)?
At third quarter’s end, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of -20% from one quarter earlier. On the other hand, there were a total of 11 hedge funds with a bullish position in NC a year ago. 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, Renaissance Technologies has the most valuable position in NACCO Industries, Inc. (NYSE:NC), worth close to $6 million, comprising less than 0.1%% of its total 13F portfolio. Coming in second is D. E. Shaw of D E Shaw, with a $0.3 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other professional money managers with similar optimism contain Ali Motamed’s Invenomic Capital Management, Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital and . In terms of the portfolio weights assigned to each position Invenomic Capital Management allocated the biggest weight to NACCO Industries, Inc. (NYSE:NC), around 0.16% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to NC.
Due to the fact that NACCO Industries, Inc. (NYSE:NC) has experienced falling interest from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of fund managers who were dropping their full holdings in the third quarter. At the top of the heap, Israel Englander’s Millennium Management said goodbye to the biggest investment of all the hedgies watched by Insider Monkey, worth an estimated $0.3 million in stock, and Frederick DiSanto’s Ancora Advisors was right behind this move, as the fund cut about $0.2 million worth. These bearish behaviors are important to note, as total hedge fund interest was cut by 1 funds in the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as NACCO Industries, Inc. (NYSE:NC) but similarly valued. These stocks are Evogene Ltd. (NASDAQ:EVGN), Battalion Oil Corporation (NYSE:BATL), Riot Blockchain, Inc (NASDAQ:RIOT), Points International Ltd (NASDAQ:PCOM), Entravision Communications Corporation (NYSE:EVC), StoneCastle Financial Corp (NASDAQ:BANX), and DarioHealth Corp. (NASDAQ:DRIO). All of these stocks’ market caps are closest to NC’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 4.3 hedge funds with bullish positions and the average amount invested in these stocks was $19 million. That figure was $7 million in NC’s case. Entravision Communications Corporation (NYSE:EVC) is the most popular stock in this table. On the other hand StoneCastle Financial Corp (NASDAQ:BANX) is the least popular one with only 1 bullish hedge fund positions. NACCO Industries, Inc. (NYSE:NC) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for NC is 33.7. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through November 27th and still beat the market by 16.1 percentage points. A small number of hedge funds were also right about betting on NC as the stock returned 50.9% since the end of the third quarter (through 11/27) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.