Is Owens Corning (NYSE:OC) a good stock to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.
Owens Corning (NYSE:OC) investors should pay attention to an increase in enthusiasm from smart money recently. 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 Hubbell Incorporated (NYSE:HUB), NRG Energy Inc (NYSE:NRG), and City National Corp (NYSE:CYN) to gather more data points.
In today’s marketplace there are many tools investors use to size up their stock investments. A pair of the less utilized tools are hedge fund and insider trading activity. our experts have shown that, historically, those who follow the top picks of the best hedge fund managers can trounce the market by a healthy amount (see the details here).
Now, let’s go over the key action surrounding Owens Corning (NYSE:OC).
Hedge fund activity in Owens Corning (NYSE:OC)
At the end of the third quarter, a total of 45 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 13% from the second quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Edgar Wachenheim’s Greenhaven Associates has the most valuable position in Owens Corning (NYSE:OC), worth close to $144.1 million, amounting to 2.9% of its total 13F portfolio. On Greenhaven Associates’s heels is LionEye Capital Management, led by Stephen V. Raneri, holding a $141.9 million call position; the fund has 5.9% of its 13F portfolio invested in the stock. Remaining members of the smart money with similar optimism encompass David Tepper’s Appaloosa Management LP and Patrick Halloran’s Wayzata Investment Partners.
Now, specific money managers were leading the bulls’ herd. Highbridge Capital Management, managed by Glenn Russell Dubin, initiated the biggest position in Owens Corning (NYSE:OC). Highbridge Capital Management had $14,7 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson’s Adage Capital Management also made a $10,2 million investment in the stock during the quarter. The following funds were also among the new OC investors: Howard Shainker and Akiva Katz’s Bow Street LLC, Anand Parekh’s Alyeska Investment Group, and Charles Davidson’s Wexford Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Owens Corning (NYSE:OC) but similarly valued. We will take a look at Hubbell Incorporated (NYSE:HUB), NRG Energy Inc (NYSE:NRG), City National Corp (NYSE:CYN), and Starwood Property Trust, Inc. (NYSE:STWD). All of these stocks’ market caps match OC’s market cap.
|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 28.75 hedge funds with bullish positions and the average amount invested in these stocks was $544 million.That figure was $1,060 million in OC’s case. Hubbell Incorporated (NYSE:HUB) is the most popular stock in this table. On the other hand City National Corp (NYSE:CYN) is the least popular one with only 21 bullish hedge fund positions. Compared to these stocks Owens Corning (NYSE:OC) is more popular among hedge funds. Considering that hedge funds are fond of this stock, it may be a good idea to analyze it in detail and potentially include it in your portfolio.