Is Ventas, Inc. (VTR) Going to Burn These Hedge Funds?

With the third-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the fourth quarter. One of these stocks was Ventas, Inc. (NYSE:VTR).

Is Ventas, Inc. (NYSE:VTR) a sound investment right now? The number of long hedge fund bets shrunk by 2 in recent months.

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To most traders, hedge funds are viewed as unimportant, old investment tools of the past. While there are over 8000 funds trading today, Hedge fund experts at Insider Monkey hone in on the crème de la crème of this club, about 700 funds. These hedge fund managerspreside over the majority of the smart money’s total asset base, and by following their inimitable equity investments, Insider Monkey has formulated various investment strategies that have historically beaten the broader indices. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 18 percentage points per year for a decade in their back tests.

Now, we’re going to analyze the new action surrounding Ventas, Inc. (NYSE:VTR).

What have hedge funds been doing with Ventas, Inc. (NYSE:VTR)?

At the end of the third quarter, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -8% from the second quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their holdings substantially.

According to hedge fund experts at Insider Monkey, Jim Simons’s Renaissance Technologies had the most valuable position in Ventas, Inc. (NYSE:VTR), worth close to $177.2 million, corresponding to 0.4% of its total 13F portfolio. The second largest stake is held by Jeffrey Furber of AEW Capital Management, with a $140.4 million position; 3.3% of its 13F portfolio is allocated to the company. Other peers that hold long positions comprise Cliff Asness’s AQR Capital Management, Phill Gross and Robert Atchinson’s Adage Capital Management and Greg Poole’s Echo Street Capital Management.

Seeing as Ventas, Inc. (NYSE:VTR) has witnessed falling interest from the smart money, it’s safe to say that there was a specific group of hedgies that slashed their positions entirely heading into Q4. It’s worth mentioning that Israel Englander’s Millennium Management dropped the largest position of all the hedgies watched by Insider Monkey, valued at an estimated $108.5 million in stock. Matthew Tewksbury’s fund, Stevens Capital Management, also dumped its stock, about $5 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 2 funds heading into Q4.

Let’s check out hedge fund activity in other stocks similar to Ventas, Inc. (NYSE:VTR). We will take a look at PACCAR Inc (NASDAQ:PCAR), Western Digital Corp. (NASDAQ:WDC), Twitter Inc (NYSE:TWTR), and Boston Properties, Inc. (NYSE:BXP). All of these stocks’ market caps are closest to VTR’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
PCAR 34 450787 7
WDC 51 2249022 2
TWTR 27 248317 -20
BXP 21 651123 -6

As you can see these stocks had an average of 33 hedge funds with bullish positions and the average amount invested in these stocks were $900 million.