Oi SA (ADR) (OIBR): What Can Hedge Fund Sentiment Tell Us About This Stock?

Investing in hedge funds can bring large profits, but it’s not for everybody, since hedge funds are available only for high-net-worth individuals. They generate significant returns for investors to justify their large fees and they allocate a lot of time and employ a complex analysis to determine the best stocks to invest in. A particularly interesting group of stocks that hedge funds like is the small-caps. The huge amount of capital does not allow hedge funds to invest a lot in small-caps, but our research showed that their most popular small-cap ideas are less efficiently priced and generate stronger returns than their large- and mega-cap picks and the broader market. That is why we follow the hedge fund activity in the small-cap space.

Oi SA (ADR) (NYSE:OIBR) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 13 hedge funds’ portfolios at the end of the third quarter of 2015. At the end of this article we will also compare Oi SA to other stocks including Nautilus, Inc. (NYSE:NLS), China Yuchai International Limited (NYSE:CYD), and Clayton Williams Energy, Inc. (NASDAQ:CWEI) to get a better sense of its popularity.

According to most investors, hedge funds are seen as unimportant, old financial vehicles of yesteryear. While there are more than 8,000 funds trading today, our experts choose to focus on the top tier of this club, approximately 700 funds. These hedge fund managers shepherd most of the smart money’s total capital, and by keeping an eye on their finest stock picks, Insider Monkey has unsheathed numerous investment strategies that have historically exceeded the broader indices. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points annually for a decade in their back tests.

With all of this in mind, let’s take a gander at the latest action surrounding Oi SA (ADR) (NYSE:OIBR).

What does the smart money think about Oi SA (ADR) (NYSE:OIBR)?

Heading into Q4, a total of 13 of the hedge funds tracked by Insider Monkey were long this stock, unchanged from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were upping their stakes meaningfully (or had already accumulated large positions).

Of the funds tracked by Insider Monkey, Paulson & Co, managed by John Paulson, holds the number one position in Oi SA (ADR) (NYSE:OIBR). Paulson & Co has a $17.2 million position in the stock, comprising 0.1% of its 13F portfolio. The second-largest stake is held by Elliott Management, managed by Paul Singer, which holds a $6.6 million position; 0.1% of its 13F portfolio is allocated to the stock. Remaining professional money managers with similar optimism contain Boaz Weinstein’s Saba Capital, and Youlia Miteva’s Proxima Capital Management.