In this article we are going to use hedge fund sentiment as a tool and determine whether Silvercrest Asset Management Group Inc (NASDAQ:SAMG) is a good investment right now. We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
Silvercrest Asset Management Group Inc (NASDAQ:SAMG) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 3 hedge funds’ portfolios at the end of September. Our calculations also showed that SAMG 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). At the end of this article we will also compare SAMG to other stocks including Timberland Bancorp, Inc. (NASDAQ:TSBK), Penn Virginia Corporation (NASDAQ:PVAC), and Ramaco Resources, Inc. (NASDAQ:METC) to get a better sense of its popularity.
Video: Watch our video about the top 5 most popular hedge fund stocks.
According to most market participants, hedge funds are seen as unimportant, outdated financial vehicles of yesteryear. While there are greater than 8000 funds with their doors open at present, Our researchers hone in on the crème de la crème of this club, about 850 funds. These investment experts administer most of all hedge funds’ total asset base, and by tracking their matchless stock picks, Insider Monkey has found numerous investment strategies that have historically outperformed the broader indices. Insider Monkey’s flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
Chuck Royce of Royce & Associates
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 10 most profitable companies in the world 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. With all of this in mind we’re going to go over the fresh hedge fund action encompassing Silvercrest Asset Management Group Inc (NASDAQ:SAMG).
How have hedgies been trading Silvercrest Asset Management Group Inc (NASDAQ:SAMG)?
At the end of the third quarter, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the second quarter of 2020. By comparison, 4 hedge funds held shares or bullish call options in SAMG a year ago. With the smart money’s sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
More specifically, Royce & Associates was the largest shareholder of Silvercrest Asset Management Group Inc (NASDAQ:SAMG), with a stake worth $5.7 million reported as of the end of September. Trailing Royce & Associates was Renaissance Technologies, which amassed a stake valued at $2.5 million. Bailard Inc was 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 Royce & Associates allocated the biggest weight to Silvercrest Asset Management Group Inc (NASDAQ:SAMG), around 0.06% of its 13F portfolio. Bailard Inc is also relatively very bullish on the stock, earmarking 0.01 percent of its 13F equity portfolio to SAMG.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.
Let’s now review hedge fund activity in other stocks similar to Silvercrest Asset Management Group Inc (NASDAQ:SAMG). We will take a look at Timberland Bancorp, Inc. (NASDAQ:TSBK), Penn Virginia Corporation (NASDAQ:PVAC), Ramaco Resources, Inc. (NASDAQ:METC), Tsakos Energy Navigation Ltd. (NYSE:TNP), Horizon Global Corp (NYSE:HZN), Ayala Pharmaceuticals, Inc. (NASDAQ:AYLA), and Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP). This group of stocks’ market valuations are similar to SAMG’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TSBK | 4 | 18156 | 1 |
| PVAC | 9 | 25550 | -2 |
| METC | 6 | 2809 | -3 |
| TNP | 4 | 11320 | -5 |
| HZN | 3 | 16612 | 0 |
| AYLA | 3 | 10125 | -1 |
| CRBP | 8 | 16655 | -6 |
| Average | 5.3 | 14461 | -2.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.3 hedge funds with bullish positions and the average amount invested in these stocks was $14 million. That figure was $8 million in SAMG’s case. Penn Virginia Corporation (NASDAQ:PVAC) is the most popular stock in this table. On the other hand Horizon Global Corp (NYSE:HZN) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks Silvercrest Asset Management Group Inc (NASDAQ:SAMG) is even less popular than HZN. Our overall hedge fund sentiment score for SAMG is 20. 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. Hedge funds clearly dropped the ball on SAMG as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. 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 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. A small number of hedge funds were also right about betting on SAMG as the stock returned 23.5% since Q3 (through November 23rd) and outperformed the market by an even larger margin.
Follow Silvercrest Asset Management Group Inc. (NASDAQ:SAMG)
Follow Silvercrest Asset Management Group Inc. (NASDAQ:SAMG)
Disclosure: None. This article was originally published at Insider Monkey.
