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. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of Littelfuse, Inc. (NASDAQ:LFUS).
Is Littelfuse, Inc. (NASDAQ:LFUS) undervalued? The best stock pickers are getting more bullish. The number of bullish hedge fund bets advanced by 1 lately. Our calculations also showed that LFUS isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). LFUS was in 22 hedge funds' portfolios at the end of the first quarter of 2020. There were 21 hedge funds in our database with LFUS positions at the end of the previous quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most market participants, hedge funds are viewed as slow, old investment vehicles of years past. While there are over 8000 funds with their doors open at the moment, We choose to focus on the leaders of this club, about 850 funds. Most estimates calculate that this group of people have their hands on the lion's share of the hedge fund industry's total asset base, and by keeping an eye on their inimitable stock picks, Insider Monkey has found a number of investment strategies that have historically beaten the market. Insider Monkey's flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we're going to review the latest hedge fund action regarding Littelfuse, Inc. (NASDAQ:LFUS).
How are hedge funds trading Littelfuse, Inc. (NASDAQ:LFUS)?
At the end of the first quarter, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 5% from the fourth quarter of 2019. On the other hand, there were a total of 13 hedge funds with a bullish position in LFUS a year ago. With hedgies' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
More specifically, Impax Asset Management was the largest shareholder of Littelfuse, Inc. (NASDAQ:LFUS), with a stake worth $69.3 million reported as of the end of September. Trailing Impax Asset Management was Ariel Investments, which amassed a stake valued at $52.5 million. Fisher Asset Management, D E Shaw, and Giverny Capital 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 Ayrshire Capital Management allocated the biggest weight to Littelfuse, Inc. (NASDAQ:LFUS), around 1.86% of its 13F portfolio. Giverny Capital is also relatively very bullish on the stock, earmarking 1 percent of its 13F equity portfolio to LFUS.
With a general bullishness amongst the heavyweights, key hedge funds were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, assembled the biggest position in Littelfuse, Inc. (NASDAQ:LFUS). Citadel Investment Group had $1.9 million invested in the company at the end of the quarter. Benjamin A. Smith's Laurion Capital Management also initiated a $1.3 million position during the quarter. The following funds were also among the new LFUS investors: Peter Muller's PDT Partners, Alec Litowitz and Ross Laser's Magnetar Capital, and Greg Eisner's Engineers Gate Manager.
Let's now review hedge fund activity in other stocks similar to Littelfuse, Inc. (NASDAQ:LFUS). We will take a look at Globant SA (NYSE:GLOB), Axis Capital Holdings Limited (NYSE:AXS), Cyberark Software Ltd (NASDAQ:CYBR), and New Jersey Resources Corp (NYSE:NJR). This group of stocks' market valuations match LFUS's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position GLOB,17,81232,-1 AXS,32,593560,-2 CYBR,14,133983,-6 NJR,14,36464,-6 Average,19.25,211310,-3.75 [/table]
As you can see these stocks had an average of 19.25 hedge funds with bullish positions and the average amount invested in these stocks was $211 million. That figure was $218 million in LFUS's case. Axis Capital Holdings Limited (NYSE:AXS) is the most popular stock in this table. On the other hand Cyberark Software Ltd (NASDAQ:CYBR) is the least popular one with only 14 bullish hedge fund positions. Littelfuse, Inc. (NASDAQ:LFUS) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th but still beat the market by 14.2 percentage points. Hedge funds were also right about betting on LFUS as the stock returned 31.7% in Q2 (through June 10th) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
