Should I Buy Comstock Mining, Inc. (LODE)?

Is Comstock Mining, Inc. (NYSE:LODE) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.

Comstock Mining, Inc. (NYSE:LODE) shares haven't seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 4 hedge funds' portfolios at the end of March. Our calculations also showed that LODE isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings). At the end of this article we will also compare LODE to other stocks including Annovis Bio, Inc. (NYSE:ANVS), Spark Networks SE (NYSE:LOV), and Select Bancorp, Inc. (NASDAQ:SLCT) to get a better sense of its popularity.

If you'd ask most market participants, hedge funds are perceived as unimportant, outdated financial tools of years past. While there are more than 8000 funds trading today, Our experts look at the crème de la crème of this club, approximately 850 funds. These hedge fund managers direct the majority of the hedge fund industry's total asset base, and by watching their first-class investments, Insider Monkey has determined several investment strategies that have historically defeated Mr. Market. Insider Monkey's flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Also, our monthly newsletter's portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Donald Sussman Paloma Partners
Donald Sussman Paloma Partners

Donald Sussman of Paloma Partners

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $27 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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 homepage. With all of this in mind let's take a look at the latest hedge fund action surrounding Comstock Mining, Inc. (NYSE:LODE).

Do Hedge Funds Think LODE Is A Good Stock To Buy Now?

At first quarter's end, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards LODE over the last 23 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.

Is LODE A Good Stock To Buy?
Is LODE A Good Stock To Buy?

Of the funds tracked by Insider Monkey, Ken Griffin's Citadel Investment Group has the number one call position in Comstock Mining, Inc. (NYSE:LODE), worth close to $1.7 million, comprising less than 0.1%% of its total 13F portfolio. On Citadel Investment Group's heels is Paloma Partners, led by Donald Sussman, holding a $0.4 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions include Ken Griffin's Citadel Investment Group, John Overdeck and David Siegel's Two Sigma Advisors and Renaissance Technologies. In terms of the portfolio weights assigned to each position Paloma Partners allocated the biggest weight to Comstock Mining, Inc. (NYSE:LODE), around 0.01% of its 13F portfolio. Two Sigma Advisors is also relatively very bullish on the stock, dishing out 0.0006 percent of its 13F equity portfolio to LODE.

We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Millennium Management. One hedge fund selling its entire position doesn't always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don't think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Paloma Partners).

Let's check out hedge fund activity in other stocks similar to Comstock Mining, Inc. (NYSE:LODE). We will take a look at Annovis Bio, Inc. (NYSE:ANVS), Spark Networks SE (NYSE:LOV), Select Bancorp, Inc. (NASDAQ:SLCT), Five Star Senior Living Inc. (NYSE:FVE), American Resources Corporation (NASDAQ:AREC), The Bank of Princeton (NASDAQ:BPRN), and Trecora Resources (NYSE:TREC). All of these stocks' market caps resemble LODE's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ANVS,6,10079,5 LOV,6,44401,-3 SLCT,5,11115,0 FVE,11,27833,0 AREC,3,1966,2 BPRN,2,13793,0 TREC,6,24483,0 Average,5.6,19096,0.6 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 5.6 hedge funds with bullish positions and the average amount invested in these stocks was $19 million. That figure was $1 million in LODE's case. Five Star Senior Living Inc. (NYSE:FVE) is the most popular stock in this table. On the other hand The Bank of Princeton (NASDAQ:BPRN) is the least popular one with only 2 bullish hedge fund positions. Comstock Mining, Inc. (NYSE:LODE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for LODE is 40.1. 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. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th and surpassed the market again by 3.3 percentage points. Unfortunately LODE wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); LODE investors were disappointed as the stock returned -10.9% since the end of March (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.

Get real-time email alerts: Follow Comstock Mining Inc. (NYSEMKT:LODE)

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

Related Content

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

If you would like to receive our free newsletter via email, simply enter your email address below & click subscribe.

MOST ACTIVE MINING STOCKS

 Daily Gainers

 Lincoln Minerals Limited LML.AX +125.00%
 Golden Cross Resources Ltd. GCR.AX +33.33%
 Casa Minerals Inc. CASA.V +30.00%
 Astro Resources NL ARO.AX +25.00%
 Athena Resources Ltd. AHN.AX +22.22%
 Adavale Resources Limited ADD.AX +22.22%
 Azimut Exploration Inc. AZM.V +21.98%
 New Stratus Energy Inc. NSE.V +21.05%
 Dynasty Gold Corp. DYG.V +18.42%
 Azincourt Energy Corp. AAZ.V +18.18%