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Is BURL Stock A Buy or Sell?

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A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Burlington Stores Inc (NYSE:BURL).

Is BURL stock a buy? Burlington Stores Inc (NYSE:BURL) investors should pay attention to a decrease in activity from the world's largest hedge funds recently. Burlington Stores Inc (NYSE:BURL) was in 29 hedge funds' portfolios at the end of December. The all time high for this statistic is 40. Our calculations also showed that BURL isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).

Ryan Frick Dorsal Capital
Ryan Frick Dorsal Capital

Ryan Frick of Dorsal Capital

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we heard that billionaire Peter Thiel is backing this psychedelic-drug startup. So, we are taking a closer look at this space. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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. Keeping this in mind we're going to analyze the key hedge fund action regarding Burlington Stores Inc (NYSE:BURL).

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

Heading into the first quarter of 2021, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -3% from the previous quarter. On the other hand, there were a total of 36 hedge funds with a bullish position in BURL a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, Phill Gross and Robert Atchinson's Adage Capital Management has the number one position in Burlington Stores Inc (NYSE:BURL), worth close to $544.8 million, accounting for 1.2% of its total 13F portfolio. The second most bullish fund manager is Third Point, led by Dan Loeb, holding a $436.8 million position; the fund has 3.4% of its 13F portfolio invested in the stock. Other peers that are bullish comprise Ryan Frick and Oliver Evans's Dorsal Capital Management, James Parsons's Junto Capital Management and Dmitry Balyasny's Balyasny Asset Management. In terms of the portfolio weights assigned to each position Dorsal Capital Management allocated the biggest weight to Burlington Stores Inc (NYSE:BURL), around 4.54% of its 13F portfolio. MIK Capital is also relatively very bullish on the stock, designating 3.88 percent of its 13F equity portfolio to BURL.

Since Burlington Stores Inc (NYSE:BURL) has experienced falling interest from the entirety of the hedge funds we track, it's safe to say that there lies a certain "tier" of hedge funds who were dropping their full holdings in the fourth quarter. It's worth mentioning that Gabriel Plotkin's Melvin Capital Management sold off the biggest position of the 750 funds tracked by Insider Monkey, totaling an estimated $72.1 million in stock. Robert Pohly's fund, Samlyn Capital, also dumped its stock, about $71.3 million worth. These moves are important to note, as total hedge fund interest dropped by 1 funds in the fourth quarter.

Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Burlington Stores Inc (NYSE:BURL) but similarly valued. We will take a look at Fox Corporation (NASDAQ:FOX), Catalent Inc (NYSE:CTLT), Akamai Technologies, Inc. (NASDAQ:AKAM), Agnico Eagle Mines Limited (NYSE:AEM), Cheniere Energy Partners LP (NYSE:CQP), ONEOK, Inc. (NYSE:OKE), and DISH Network Corp. (NASDAQ:DISH). This group of stocks' market caps resemble BURL's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FOX,17,530820,2 CTLT,35,839418,-5 AKAM,33,280317,-7 AEM,36,388901,8 CQP,4,9283,1 OKE,22,105420,2 DISH,57,2021289,-3 Average,29.1,596493,-0.3 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 29.1 hedge funds with bullish positions and the average amount invested in these stocks was $596 million. That figure was $1336 million in BURL's case. DISH Network Corp. (NASDAQ:DISH) is the most popular stock in this table. On the other hand Cheniere Energy Partners LP (NYSE:CQP) is the least popular one with only 4 bullish hedge fund positions. Burlington Stores Inc (NYSE:BURL) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for BURL is 49.3. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.2% in 2021 through April 12th and still beat the market by 1.5 percentage points. A small number of hedge funds were also right about betting on BURL as the stock returned 24.4% since the end of the fourth quarter (through 4/12) 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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