The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider Michaels Companies Inc (NASDAQ:MIK) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is Michaels Companies Inc (NASDAQ:MIK) a healthy stock for your portfolio? The smart money is getting more bullish. The number of bullish hedge fund bets increased by 5 in recent months. 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 Zillow Group, Inc.- Class C (NASDAQ:Z), Quanta Services Inc (NYSE:PWR), and Acadia Healthcare Company Inc (NASDAQ:ACHC) to gather more data points.
To the average investor there are several gauges investors use to assess publicly traded companies. A pair of the most under-the-radar gauges are hedge fund and insider trading interest. Our experts have shown that, historically, those who follow the best picks of the elite money managers can outclass their index-focused peers by a significant margin (see the details here).
With all of this in mind, we’re going to take a look at the new action regarding Michaels Companies Inc (NASDAQ:MIK).
How have hedgies been trading Michaels Companies Inc (NASDAQ:MIK)?
Heading into Q4, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 31% from one quarter earlier. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Highfields Capital Management, managed by Jonathon Jacobson, holds the largest position in Michaels Companies Inc (NASDAQ:MIK). Highfields Capital Management has a $146.1 million position in the stock, comprising 1.3% of its 13F portfolio. The second largest stake is held by Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, which holds a $26.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other professional money managers that are bullish comprise Alexander Mitchell’s Scopus Asset Management, Shashin Shah’s Think Investments and Jim Simons’ Renaissance Technologies.
With a general bullishness amongst the heavyweights, specific money managers have jumped into Michaels Companies Inc (NASDAQ:MIK) headfirst. Scopus Asset Management, managed by Alexander Mitchell, initiated the most valuable position in Michaels Companies Inc (NASDAQ:MIK). Scopus Asset Management had $18.3 million invested in the company at the end of the quarter. Shashin Shah’s Think Investments also initiated a $17 million position during the quarter. The other funds with brand new MIK positions are John Overdeck and David Siegel’s Two Sigma Advisors, John A. Levin’s Levin Capital Strategies, and Paul Tudor Jones’ Tudor Investment Corp.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Michaels Companies Inc (NASDAQ:MIK) but similarly valued. We will take a look at Zillow Group, Inc.- Class C (NASDAQ:Z), Quanta Services Inc (NYSE:PWR), Acadia Healthcare Company Inc (NASDAQ:ACHC), and Carter’s, Inc. (NYSE:CRI). This group of stocks’ market valuations are similar to MIK’s market valuation.
|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 31 hedge funds with bullish positions and the average amount invested in these stocks was $542 million. That figure was $275 million in MIK’s case. Carter’s, Inc. (NYSE:CRI) is the most popular stock in this table. On the other hand Zillow Group, Inc.- Class C (NASDAQ:Z) is the least popular one with only 24 bullish hedge fund positions. Compared to these stocks Michaels Companies Inc (NASDAQ:MIK) is even less popular than Z. 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.