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. In this article we are going to take a look at smart money sentiment towards Commercial Vehicle Group, Inc. (NASDAQ:CVGI).
Is CVGI a good stock to buy now? Commercial Vehicle Group, Inc. (NASDAQ:CVGI) was in 12 hedge funds' portfolios at the end of September. The all time high for this statistics is 15. CVGI investors should pay attention to a decrease in hedge fund interest of late. There were 13 hedge funds in our database with CVGI holdings at the end of June. Our calculations also showed that CVGI 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.
To most shareholders, hedge funds are assumed to be unimportant, outdated investment tools of the past. While there are over 8000 funds with their doors open at the moment, We hone in on the bigwigs of this club, about 850 funds. These hedge fund managers control most of all hedge funds' total asset base, and by watching their best equity investments, Insider Monkey has determined various investment strategies that have historically outrun the market. Insider Monkey's flagship short hedge fund strategy outperformed 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
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 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 new hedge fund action regarding Commercial Vehicle Group, Inc. (NASDAQ:CVGI).
Do Hedge Funds Think CVGI Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -8% from one quarter earlier. By comparison, 11 hedge funds held shares or bullish call options in CVGI a year ago. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Commercial Vehicle Group, Inc. (NASDAQ:CVGI) was held by Renaissance Technologies, which reported holding $15.4 million worth of stock at the end of September. It was followed by Royce & Associates with a $7.4 million position. Other investors bullish on the company included Portolan Capital Management, DC Capital Partners, and Arrowstreet Capital. In terms of the portfolio weights assigned to each position DC Capital Partners allocated the biggest weight to Commercial Vehicle Group, Inc. (NASDAQ:CVGI), around 18.5% of its 13F portfolio. Portolan Capital Management is also relatively very bullish on the stock, designating 0.55 percent of its 13F equity portfolio to CVGI.
Due to the fact that Commercial Vehicle Group, Inc. (NASDAQ:CVGI) has witnessed falling interest from hedge fund managers, we can see that there is a sect of hedgies who were dropping their positions entirely in the third quarter. It's worth mentioning that Ali Motamed's Invenomic Capital Management dumped the largest stake of the "upper crust" of funds monitored by Insider Monkey, worth close to $0.3 million in stock. Donald Sussman's fund, Paloma Partners, also cut its stock, about $0.2 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 1 funds in the third quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Commercial Vehicle Group, Inc. (NASDAQ:CVGI) but similarly valued. These stocks are Horizon Technology Finance Corp (NASDAQ:HRZN), Auryn Resources Inc. (NYSE:AUG), Priority Technology Holdings, Inc. (NASDAQ:PRTH), StarTek, Inc. (NYSE:SRT), Southern National Bancorp of Virginia, Inc (NASDAQ:SONA), Energy Fuels Inc (NYSE:UUUU), and Nathan's Famous, Inc. (NASDAQ:NATH). All of these stocks' market caps match CVGI's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position HRZN,2,2270,0 AUG,5,3610,2 PRTH,2,1652,-1 SRT,2,4387,-1 SONA,9,8507,-1 UUUU,3,953,-3 NATH,5,25066,1 Average,4,6635,-0.4 [/table]
As you can see these stocks had an average of 4 hedge funds with bullish positions and the average amount invested in these stocks was $7 million. That figure was $36 million in CVGI's case. Southern National Bancorp of Virginia, Inc (NASDAQ:SONA) is the most popular stock in this table. On the other hand Horizon Technology Finance Corp (NASDAQ:HRZN) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Commercial Vehicle Group, Inc. (NASDAQ:CVGI) is more popular among hedge funds. Our overall hedge fund sentiment score for CVGI is 78. 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 returned 32.9% in 2020 through December 8th but still managed to beat the market by 16.2 percentage points. Hedge funds were also right about betting on CVGI as the stock returned 30% since the end of September (through 12/8) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Get real-time email alerts: Follow Commercial Vehicle Group Inc. (NASDAQ:CVGI)
Disclosure: None. This article was originally published at Insider Monkey.
