World-class money managers like Ken Griffin and Barry Rosenstein only invest their wealthy clients' money after undertaking a rigorous examination of any potential stock. They are particularly successful in this regard when it comes to small-cap stocks, which their peerless research gives them a big information advantage on when it comes to judging their worth. It's not surprising then that they generate their biggest returns from these stocks and invest more of their money in these stocks on average than other investors. It's also not surprising then that we pay close attention to these picks ourselves and have built a market-beating investment strategy around them.
Is Spirit Realty Capital Inc (NYSE:SRC) a buy, sell, or hold? Money managers are taking a pessimistic view. The number of bullish hedge fund bets dropped by 8 in recent months. Our calculations also showed that SRC isn't among the 30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 6.3% year to date (through December 3rd) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 18 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We're going to analyze the fresh hedge fund action regarding Spirit Realty Capital Inc (NYSE:SRC).
What have hedge funds been doing with Spirit Realty Capital Inc (NYSE:SRC)?
At the end of the third quarter, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -28% from the previous quarter. The graph below displays the number of hedge funds with bullish position in SRC over the last 13 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Scopia Capital held the most valuable stake in Spirit Realty Capital Inc (NYSE:SRC), which was worth $150.7 million at the end of the third quarter. On the second spot was Knighthead Capital which amassed $72.8 million worth of shares. Moreover, Arrowstreet Capital, Renaissance Technologies, and Permian Investment Partners were also bullish on Spirit Realty Capital Inc (NYSE:SRC), allocating a large percentage of their portfolios to this stock.