Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the first quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Gladstone Land Corporation (NASDAQ:LAND) based on that data.
Gladstone Land Corporation (NASDAQ:LAND) has experienced an increase in activity from the world's largest hedge funds recently. LAND was in 8 hedge funds' portfolios at the end of the first quarter of 2020. There were 7 hedge funds in our database with LAND holdings at the end of the previous quarter. Our calculations also showed that LAND 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).
Video: Watch our video about the top 5 most popular hedge fund stocks.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 58 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 36% through May 18th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let's take a look at the new hedge fund action encompassing Gladstone Land Corporation (NASDAQ:LAND).
What have hedge funds been doing with Gladstone Land Corporation (NASDAQ:LAND)?
At the end of the first quarter, a total of 8 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from the fourth quarter of 2019. The graph below displays the number of hedge funds with bullish position in LAND over the last 18 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Renaissance Technologies held the most valuable stake in Gladstone Land Corporation (NASDAQ:LAND), which was worth $3.7 million at the end of the third quarter. On the second spot was Winton Capital Management which amassed $1.4 million worth of shares. Millennium Management, Two Sigma Advisors, and Horizon Asset Management 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 Winton Capital Management allocated the biggest weight to Gladstone Land Corporation (NASDAQ:LAND), around 0.04% of its 13F portfolio. Horizon Asset Management is also relatively very bullish on the stock, designating 0.03 percent of its 13F equity portfolio to LAND.
As one would reasonably expect, key hedge funds were leading the bulls' herd. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, initiated the most valuable position in Gladstone Land Corporation (NASDAQ:LAND). Arrowstreet Capital had $0.3 million invested in the company at the end of the quarter.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Gladstone Land Corporation (NASDAQ:LAND) but similarly valued. We will take a look at Personalis, Inc. (NASDAQ:PSNL), iRadimed Corporation (NASDAQ:IRMD), Catasys, Inc. (NASDAQ:CATS), and Invacare Corporation (NYSE:IVC). This group of stocks' market caps resemble LAND's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PSNL,5,7405,-5 IRMD,14,32146,2 CATS,8,6175,2 IVC,19,62476,4 Average,11.5,27051,0.75 [/table]
As you can see these stocks had an average of 11.5 hedge funds with bullish positions and the average amount invested in these stocks was $27 million. That figure was $9 million in LAND's case. Invacare Corporation (NYSE:IVC) is the most popular stock in this table. On the other hand Personalis, Inc. (NASDAQ:PSNL) is the least popular one with only 5 bullish hedge fund positions. Gladstone Land Corporation (NASDAQ:LAND) is not the least popular stock in this group but hedge fund interest is still below 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 12.2% in 2020 through June 17th and still beat the market by 14.8 percentage points. A small number of hedge funds were also right about betting on LAND as the stock returned 32.1% during the second quarter and outperformed the market by an even larger margin.
