We know that hedge funds generate strong, risk-adjusted returns over the long term. Therefore, emulating the choices they are collectively optimistic about can be a profitable strategy for retail investors. With billions of dollars in assets, smart investors must perform complex analysis, spend many resources, and use tools that are not always available to the general public. That’s not to say they don’t have occasional colossal losses; they do (like Melvin Capital’s recent GameStop losses). However, it is always a good idea to keep an eye on hedge fund activity. With that in mind, as the current round of 13F filings just ended, let’s take a look at the smart money sentiment towards US Lime & Minerals Inc. (NASDAQ: USLM).
Is USLM a good stock to buy? US Lime & Minerals Inc. (NASDAQ: USLM) investors should pay attention to a drop in hedge fund interest in recent months. US Lime & Minerals Inc. (NASDAQ: USLM) was listed in 4 hedge fund portfolios at the end of the first quarter of 2021. The all-time high for this statistic is 7. There were 5 hedge funds in our database with holdings USLM at the end of December. Our calculations also showed that USLM is not in the top 30 most popular stocks among hedge funds (click for Q1 rank).
Right now, there are a plethora of gauges that market participants have at their disposal to analyze stocks. Some of the best indicators are the hedge fund and insider trading indicators. Our experts have shown that historically those who follow the best picks of elite hedge fund managers can beat the S&P 500 by a healthy amount (see details here). Additionally, our monthly newsletter’s long stock picks portfolio has returned 206.8% since March 2017 (through May 2021) and has beaten the S&P 500 Index by over 115 percentage points. You can download a sample issue of this newsletter from our website.
Chuck Royce of Royce & Associates
At Insider Monkey, we scour multiple sources to uncover the next big investing idea. For example, an activist hedge fund wants to buy this $ 27 biotech share for $ 50. We therefore recommended a long position to our monthly premium newsletter subscribers. We’re going through lists like the top 10 battery stocks to pick the next Tesla that will deliver 10x performance. Even though we only recommend positions in a tiny fraction of the companies we analyze, we check as many stocks as possible. We read letters from hedge fund investors and listen to market arguments at hedge fund conferences. You can sign up for our free daily newsletter on our homepage. With all of that in mind, we’re going to review the key hedge fund action regarding US Lime & Minerals Inc. (NASDAQ: USLM).
Do hedge funds think USLM is a good stock to buy now?
At the end of the first quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long on this stock, a change of -20% from the previous quarter. Below you can see how hedge fund sentiment towards USLM has developed over the past 23 quarters. So let’s take a look at which hedge funds were among the top stock holders and which hedge funds were making big moves.
According to publicly available data on hedge funds and institutional investors compiled by Insider Monkey, Renaissance Technologies holds the most valuable position in US Lime & Minerals Inc. (NASDAQ: USLM). Renaissance Technologies has a position of $ 27.8 million in inventory, comprising less than 0.1 %% of its 13F portfolio. In second place, Royce & Associates, led by Chuck Royce, has a position of $ 14.2 million; 0.1% of its 13F portfolio is allocated to society. Some other smart money members who hold long positions include David P. Cohen’s Minerva Advisors, Ken Griffin’s and Citadel Investment Group. In terms of the portfolio weights assigned to each position, Minerva Advisors assigned the largest weight to US Lime & Minerals Inc. (NASDAQ: USLM), approximately 2.86% of its 13F portfolio. Royce & Associates is also relatively very bullish on the stock, allocating 0.1% of its 13F equity portfolio to USLM.
Given that US Lime & Minerals Inc. (NASDAQ: USLM) witnessed bearish sentiment across all of the hedge funds we track, it is easy to see that there was a specific group of fund managers. who decided to sell all of their stakes in the last quarter. At the top of the heap, Roger Ibbotson’s Zebra Capital Management dropped the largest position of all hedges tracked by Insider Monkey, totaling around $ 0.3 million in shares. Jeffrey Bronchick’s fund, Cove Street Capital, also bid farewell to its shares, valued at around $ 0 million. These transactions are intriguing to say the least, as overall hedge fund interest fell by 1 fund in the last quarter.
Now let’s review hedge fund activity in other stocks similar to US Lime & Minerals Inc. (NASDAQ: USLM). These stocks are Asensus Surgical, Inc. (NYSE: ASXC), Loma Negra Compania Industrial Argentina Sociedad Anonima (NYSE: LOMA), Central Pacific Financial Corp. (NYSE: CPF), Aspira Women’s Health Inc. (NASDAQ: AWH), AdvanSix Inc. (NYSE: ASIX), Sportsman’s Warehouse Holdings Inc (NASDAQ: SPWH) and SLR Investment Corp. (NASDAQ: SLRC). The market capitalizations of this group of stocks resemble the market capitalization of USLM.
[table] Ticker, number of HF with positions, total value of HF positions (x1000), change of HF position ASXC, 8.27618.5 LOMA, 6.50928, -4 CPF, 13.50673, -2 AWH, 8.20897, 2 ASIX, 18.70328.5 SPWH, 18.212159, -7 SLRC, 9.20926, -3 Medium, 11.4.64790, -0.6 [/table]
Check the table here if you have formatting issues.
As you can see, these stocks had an average of 11.4 hedge funds with bullish positions and the average amount invested in these stocks was $ 65 million. That figure was $ 48 million in the case of USLM. AdvanSix Inc. (NYSE: ASIX) is the most popular stock in this table. On the other hand, Loma Negra Compania Industrial Argentina Sociedad Anonima (NYSE: LOMA) is the least popular with only 6 bullish hedge fund positions. Compared to these stocks, US Lime & Minerals Inc. (NASDAQ: USLM) is even less popular than LOMA. Our overall hedge fund sentiment score for USLM is 21.1. Stocks with a 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 dodged a bullet by taking a bearish stance towards USLM. Our calculations showed that the 10 most popular hedge fund stocks returned 95.8% in 2019 and 2020 and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11, but managed to beat the market again by 3.3 percentage points. Unfortunately, USLM was not as popular as these 5 stocks (hedge fund sentiment was very bearish); USLM investors were disappointed as the stock has returned 6.2% since the end of the first quarter (through 6/11) and has underperformed the market. If you want to invest in large cap stocks with huge upside potential, you should check out the 5 most popular stocks among hedge funds, as most of these stocks have already outperformed the market since 2019.
Receive real-time email alerts: Follow United States Lime & Minerals Inc (NASDAQ: USLM)
Disclosure: none. This article originally appeared on Insider Monkey.