Here is What Hedge Funds Think About Stratus Properties Inc. (STRS)

Asma UL Husna

The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Stratus Properties Inc. (NASDAQ:STRS).

Stratus Properties Inc. (NASDAQ:STRS) shareholders have witnessed an increase in support from the world's most elite money managers recently. Stratus Properties Inc. (NASDAQ:STRS) was in 3 hedge funds' portfolios at the end of September. The all time high for this statistics is 4. There were 2 hedge funds in our database with STRS holdings at the end of June. Our calculations also showed that STRS 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.

According to most shareholders, hedge funds are viewed as underperforming, old financial tools of yesteryear. While there are over 8000 funds trading today, We hone in on the elite of this group, about 850 funds. Most estimates calculate that this group of people shepherd bulk of all hedge funds' total asset base, and by observing their inimitable equity investments, Insider Monkey has discovered numerous investment strategies that have historically defeated the broader indices. Insider Monkey's flagship short hedge fund strategy surpassed the S&P 500 short ETFs by around 20 percentage points a 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 .

Xiniya Earnings Call Transcript XNY 2014 Q3
Xiniya Earnings Call Transcript XNY 2014 Q3

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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 10 most profitable companies in the world 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.With all of this in mind let's take a gander at the new hedge fund action surrounding Stratus Properties Inc. (NASDAQ:STRS).

What have hedge funds been doing with Stratus Properties Inc. (NASDAQ:STRS)?

At the end of September, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 50% from the previous quarter. On the other hand, there were a total of 3 hedge funds with a bullish position in STRS a year ago. With the smart money's positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings significantly (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Seth Fischer's Oasis Management has the biggest position in Stratus Properties Inc. (NASDAQ:STRS), worth close to $24.2 million, comprising 10.7% of its total 13F portfolio. Coming in second is Deep Field Asset Management, led by Jordan Moelis and Jeff Farroni, holding a $1.9 million position; 1.2% of its 13F portfolio is allocated to the stock. In terms of the portfolio weights assigned to each position Oasis Management allocated the biggest weight to Stratus Properties Inc. (NASDAQ:STRS), around 10.71% of its 13F portfolio. Deep Field Asset Management is also relatively very bullish on the stock, setting aside 1.2 percent of its 13F equity portfolio to STRS.

As industrywide interest jumped, key hedge funds have jumped into Stratus Properties Inc. (NASDAQ:STRS) headfirst. Deep Field Asset Management, managed by Jordan Moelis and Jeff Farroni, assembled the most outsized position in Stratus Properties Inc. (NASDAQ:STRS). Deep Field Asset Management had $1.9 million invested in the company at the end of the quarter.

Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Stratus Properties Inc. (NASDAQ:STRS) but similarly valued. We will take a look at Protara Therapeutics, Inc. (NASDAQ:TARA), Daktronics, Inc. (NASDAQ:DAKT), Titan International Inc (NYSE:TWI), NeuBase Therapeutics, Inc. (NASDAQ:NBSE), Precision Drilling Corp (NYSE:PDS), Carter Bank & Trust (NASDAQ:CARE), and Scorpio Bulkers Inc (NYSE:SALT). This group of stocks' market valuations resemble STRS's market valuation.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TARA,15,122192,7 DAKT,14,12586,0 TWI,13,38386,0 NBSE,6,23679,-3 PDS,8,8565,2 CARE,11,6673,0 SALT,2,2433,-7 Average,9.9,30645,-0.1 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.9 hedge funds with bullish positions and the average amount invested in these stocks was $31 million. That figure was $27 million in STRS's case. Protara Therapeutics, Inc. (NASDAQ:TARA) is the most popular stock in this table. On the other hand Scorpio Bulkers Inc (NYSE:SALT) is the least popular one with only 2 bullish hedge fund positions. Stratus Properties Inc. (NASDAQ:STRS) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for STRS is 32.3. 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 gained 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. A small number of hedge funds were also right about betting on STRS as the stock returned 13.5% since the end of the third quarter (through 11/23) and outperformed the market by an even larger margin.

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Disclosure: None. This article was originally published at Insider Monkey.

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