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Is The York Water Company (YORW) A Good Stock To Buy?

Out of thousands of stocks that are currently traded on the market, it might be really difficult to determine those that can really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs/PhDs, industry experts, and they are well connected to get tips from insiders. Individual investors can piggyback hedge funds and may be able to benefit from their vast resources. We analyze quarterly 13F filings of over 700 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about The York Water Company (NASDAQ:YORW).

The York Water Company (NASDAQ:YORW) has experienced an increase in enthusiasm from smart money lately. At the end of this article we will also compare YORW to other stocks including Akarti Therapeutics PLC (ADR) (NASDAQ:AKTX), Trinity Biotech plc (ADR) (NASDAQ:TRIB), and American Software, Inc. (NASDAQ:AMSWA) to get a better sense of its popularity.

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Keeping this in mind, we’re going to take a gander at the latest action encompassing The York Water Company (NASDAQ:YORW).

How are hedge funds trading The York Water Company (NASDAQ:YORW)?

At the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 67% from one quarter earlier. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Chuck Royce’s Royce & Associates has the most valuable position in The York Water Company (NASDAQ:YORW), worth close to $3.5 million, amounting to less than 0.1%% of its total 13F portfolio. Coming in second is Renaissance Technologies, managed by Jim Simons, which holds a $2.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other professional money managers that are bullish include Mario Gabelli’s GAMCO Investors, Israel Englander’s Millennium Management and John Overdeck and David Siegel’s Two Sigma Advisors.

Consequently, some big names have jumped into The York Water Company (NASDAQ:YORW) headfirst. Millennium Management, managed by Israel Englander, initiated the most outsized position in The York Water Company (NASDAQ:YORW). Millennium Management had $0.4 million invested in the company at the end of the quarter. John Overdeck and David Siegel’s Two Sigma Advisors also made a $0.2 million investment in the stock during the quarter.

Let’s check out hedge fund activity in other stocks similar to The York Water Company (NASDAQ:YORW). These stocks are Akarti Therapeutics PLC (ADR) (NASDAQ:AKTX), Trinity Biotech plc (ADR) (NASDAQ:TRIB), American Software, Inc. (NASDAQ:AMSWA), and Blount International, Inc. (NYSE:BLT). All of these stocks’ market caps are similar to YORW’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
AKTX 9 61820 9
TRIB 20 57248 1
AMSWA 7 18267 2
BLT 20 113965 -4

As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $63 million.That figure was $8 million in YORW’s case. Trinity Biotech plc (ADR) (NASDAQ:TRIB) is the most popular stock in this table. On the other hand American Software, Inc. (NASDAQ:AMSWA) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks The York Water Company (NASDAQ:YORW) is even less popular than AMSWA. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

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