Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small-cap stocks, especially when they are screened well, can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those elite funds in these small-cap stocks. In the following paragraphs, we analyze Humana Inc (NYSE:HUM) from the perspective of these investors.
Humana Inc (NYSE:HUM) investors should pay attention to a decrease in enthusiasm from smart money in recent months. HUM was in 56 hedge funds’ portfolios at the end of the third quarter of 2015. There were 84 hedge funds in our database with HUM holdings at the end of the previous quarter. At the end of this article we will also compare HUM to other stocks including CSX Corporation (NYSE:CSX), Crown Castle International Corp. (NYSE:CCI), and Korea Electric Power Corporation (ADR) (NYSE:KEP) to get a better sense of its popularity.
In the eyes of most traders, hedge funds are seen as slow, outdated investment tools of yesteryear. While there are more than 8,000 funds trading at the moment, our experts choose to focus on the leaders of this group, approximately 700 funds. These hedge fund managers control the lion’s share of the smart money’s total asset base, and by tailing their matchless picks, Insider Monkey has revealed a few investment strategies that have historically exceeded the broader indices. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 12 percentage points annually for a decade in their back tests.
Now, let’s take a look at the recent action surrounding Humana Inc (NYSE:HUM).
How are hedge funds trading Humana Inc (NYSE:HUM)?
Heading into Q4, a total of 56 of the hedge funds tracked by Insider Monkey were bullish on this stock, a 33% fall from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their stakes considerably (or had already accumulated large positions).
According to Insider Monkey’s hedge fund database, Larry Robbins’ Glenview Capital has the number one position in Humana Inc (NYSE:HUM), worth close to $1.19 billion, accounting for 5.9% of its total 13F portfolio. The second-most bullish fund is Viking Global, managed by Andreas Halvorsen, which holds a $689.8 million position; the fund has 2.6% of its 13F portfolio invested in the stock. Other members of the smart money that are bullish consist of Matthew Halbower’s Pentwater Capital Management, D E Shaw, and Nick Niell’s Arrowgrass Capital Partners.