Where Do Hedge Funds Stand On Cedar Fair (FUN)?

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. Insider Monkey finished processing 817 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30th, 2020. What do these smart investors think about Cedar Fair, L.P. (NYSE:FUN)?

Cedar Fair, L.P. (NYSE:FUN) was in 13 hedge funds’ portfolios at the end of September. The all time high for this statistic is 14. FUN investors should be aware of a decrease in hedge fund sentiment of late. There were 14 hedge funds in our database with FUN positions at the end of the second quarter. Our calculations also showed that FUN isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 66 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Kerr Neilson of Platinum Asset Management

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now let’s analyze the recent hedge fund action surrounding Cedar Fair, L.P. (NYSE:FUN).

Do Hedge Funds Think FUN Is A Good Stock To Buy Now?

Heading into the fourth quarter of 2020, a total of 13 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -7% from one quarter earlier. On the other hand, there were a total of 13 hedge funds with a bullish position in FUN a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is FUN A Good Stock To Buy?

More specifically, Waratah Capital Advisors was the largest shareholder of Cedar Fair, L.P. (NYSE:FUN), with a stake worth $60.5 million reported as of the end of September. Trailing Waratah Capital Advisors was Arrowstreet Capital, which amassed a stake valued at $17.6 million. Akaris Global Partners, Platinum Asset Management, and Miller Value Partners were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Akaris Global Partners allocated the biggest weight to Cedar Fair, L.P. (NYSE:FUN), around 6.96% of its 13F portfolio. Waratah Capital Advisors is also relatively very bullish on the stock, designating 6.46 percent of its 13F equity portfolio to FUN.

Since Cedar Fair, L.P. (NYSE:FUN) has faced declining sentiment from the entirety of the hedge funds we track, we can see that there exists a select few hedge funds that slashed their positions entirely by the end of the third quarter. At the top of the heap, Brad Stephens’s Six Columns Capital dropped the largest stake of the 750 funds tracked by Insider Monkey, valued at an estimated $5.5 million in stock, and Robert Bishop’s Impala Asset Management was right behind this move, as the fund said goodbye to about $3.8 million worth. These transactions are important to note, as total hedge fund interest fell by 1 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Cedar Fair, L.P. (NYSE:FUN) but similarly valued. We will take a look at Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), Avanos Medical (NYSE:AVNS), PMV Pharmaceuticals, Inc. (NASDAQ:PMVP), Korn Ferry (NYSE:KFY), MakeMyTrip Limited (NASDAQ:MMYT), Liberty Latin America Ltd. (NASDAQ:LILA), and Ameris Bancorp (NASDAQ:ABCB). This group of stocks’ market values resemble FUN’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
AAWW 27 254084 1
AVNS 20 200128 5
PMVP 17 548921 17
KFY 21 156083 -7
MMYT 10 28638 0
LILA 17 84071 2
ABCB 13 79345 -4
Average 17.9 193039 2

View table here if you experience formatting issues.

As you can see these stocks had an average of 17.9 hedge funds with bullish positions and the average amount invested in these stocks was $193 million. That figure was $113 million in FUN’s case. Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) is the most popular stock in this table. On the other hand MakeMyTrip Limited (NASDAQ:MMYT) is the least popular one with only 10 bullish hedge fund positions. Cedar Fair, L.P. (NYSE:FUN) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for FUN is 40.7. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and still beat the market by 16.2 percentage points. A small number of hedge funds were also right about betting on FUN as the stock returned 41.8% since the end of the third quarter (through 12/8) and outperformed the market by an even larger margin.

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Disclosure: None. This article was originally published at Insider Monkey.