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Is Wheeler Real Estate Investment Trust Inc (WHLR) A Good Stock To Buy?

The worries about the election and the ongoing uncertainty about the path of interest-rate increases have been keeping investors on the sidelines. Of course, most hedge funds and other asset managers have been underperforming main stock market indices since the middle of 2015. Interestingly though, smaller-cap stocks registered their best performance relative to the large-capitalization stocks since the end of the June quarter, suggesting that this may be the best time to take a cue from their stock picks. In fact, the Russell 2000 Index gained more than 15% since the beginning of the third quarter, while the Standard and Poor’s 500 benchmark returned less than 6%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR).

Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR) investors should be aware of an increase in activity from the world’s largest hedge funds of late. WHLR was in 10 hedge funds’ portfolios at the end of September. There were 7 hedge funds in our database with WHLR positions at the end of the previous quarter. At the end of this article we will also compare WHLR to other stocks including Rocket Fuel Inc (NASDAQ:FUEL), Willbros Group Inc (NYSE:WG), and Stonegate Mortageg Corp (NYSE:SGM) to get a better sense of its popularity.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

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What have hedge funds been doing with Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR)?

At Q3’s end, a total of 10 of the hedge funds tracked by Insider Monkey were long this stock, up by 43% from the previous quarter. The graph below displays the number of hedge funds with bullish position in WHLR over the last 5 quarters. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).


According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, J. Alan Reid, Jr.’s Forward Management has the biggest position in Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR), worth close to $8.4 million. Coming in second is Phillip Goldstein, Andrew Dakos and Steven Samuels of Bulldog Investors, with a $6.6 million position; 1.5% of its 13F portfolio is allocated to the stock. Other hedge funds and institutional investors that are bullish contain Emanuel J. Friedman’s EJF Capital, and Philip Hempleman’s Ardsley Partners. We should note that two of these hedge funds (Forward Management and Forward Management) are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

With a general bullishness amongst the heavyweights, key hedge funds were breaking ground themselves. Forward Management assembled the largest position in Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR). The other funds with new positions in the stock are David M. Knott’s Dorset Management, Millennium Management, which is one of the 10 largest hedge funds in the world, and Michael Thompson’s BHR Capital.

Let’s go over hedge fund activity in other stocks similar to Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR). We will take a look at Rocket Fuel Inc (NASDAQ:FUEL), Willbros Group Inc (NYSE:WG), Stonegate Mortageg Corp (NYSE:SGM), and Safe Bulkers, Inc. (NYSE:SB). This group of stocks’ market valuations are similar to WHLR’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
FUEL 8 9520 -2
WG 7 10858 -3
SGM 6 25161 -3
SB 5 6607 -1

As you can see these stocks had an average of 6 hedge funds with bullish positions and the average amount invested in these stocks was $13 million. That figure was $40 million in WHLR’s case. Rocket Fuel Inc (NASDAQ:FUEL) is the most popular stock in this table. On the other hand Safe Bulkers, Inc. (NYSE:SB) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

Disclosure: None