Is BYND Stock A Buy or Sell?
While the market driven by short-term sentiment influenced by the accommodative interest rate environment in the US, virus news and stimulus spending, many smart money investors are starting to get cautious towards the current bull run since March and hedging or reducing many of their long positions. Some fund managers are betting on Dow hitting 40,000 to generate strong returns. However, as we know, big investors usually buy stocks with strong fundamentals that can deliver gains both in bull and bear markets, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding Beyond Meat, Inc. (NASDAQ:BYND).
Is BYND stock a buy? Money managers were taking an optimistic view. The number of long hedge fund positions went up by 3 in recent months. Beyond Meat, Inc. (NASDAQ:BYND) was in 27 hedge funds' portfolios at the end of December. The all time high for this statistic is 29. Our calculations also showed that BYND isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Today there are several metrics stock market investors put to use to assess stocks. A duo of the best metrics are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the best picks of the top investment managers can beat the S&P 500 by a very impressive amount (see the details here).
Noam Gottesman of GLG Partners
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. 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. Now we're going to take a peek at the new hedge fund action surrounding Beyond Meat, Inc. (NASDAQ:BYND).
Do Hedge Funds Think BYND Is A Good Stock To Buy Now?
At fourth quarter's end, a total of 27 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 13% from one quarter earlier. By comparison, 19 hedge funds held shares or bullish call options in BYND a year ago. With hedgies' sentiment swirling, there exists a select group of key hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
According to Insider Monkey's hedge fund database, Keywise Capital Management, managed by Fang Zheng, holds the largest position in Beyond Meat, Inc. (NASDAQ:BYND). Keywise Capital Management has a $58.1 million position in the stock, comprising 17.8% of its 13F portfolio. On Keywise Capital Management's heels is Zevenbergen Capital Investments, led by Nancy Zevenbergen, holding a $43.4 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Remaining members of the smart money that are bullish include Daniel S. Och's OZ Management, Ken Griffin's Citadel Investment Group and Noam Gottesman's GLG Partners. In terms of the portfolio weights assigned to each position Keywise Capital Management allocated the biggest weight to Beyond Meat, Inc. (NASDAQ:BYND), around 17.75% of its 13F portfolio. Tenzing Global Investors is also relatively very bullish on the stock, setting aside 1.43 percent of its 13F equity portfolio to BYND.
Now, key money managers have been driving this bullishness. Impax Asset Management, managed by Ian Simm, created the largest position in Beyond Meat, Inc. (NASDAQ:BYND). Impax Asset Management had $10 million invested in the company at the end of the quarter. Chet Kapoor's Tenzing Global Investors also made a $5.9 million investment in the stock during the quarter. The other funds with brand new BYND positions are Sander Gerber's Hudson Bay Capital Management, Robert Charles Gibbins's Autonomy Capital, and Paul Marshall and Ian Wace's Marshall Wace LLP.
Let's also examine hedge fund activity in other stocks similar to Beyond Meat, Inc. (NASDAQ:BYND). We will take a look at Genpact Limited (NYSE:G), Cemex SAB de CV (NYSE:CX), Williams-Sonoma, Inc. (NYSE:WSM), Eaton Vance Corp (NYSE:EV), Axon Enterprise, Inc. (NASDAQ:AAXN), Comerica Incorporated (NYSE:CMA), and Lithia Motors Inc (NYSE:LAD). This group of stocks' market caps are similar to BYND's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position G,31,340904,3 CX,22,455726,6 WSM,29,496240,-2 EV,26,732680,3 AAXN,32,495779,0 CMA,38,582061,8 LAD,39,1577323,-10 Average,31,668673,1.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $669 million. That figure was $212 million in BYND's case. Lithia Motors Inc (NYSE:LAD) is the most popular stock in this table. On the other hand Cemex SAB de CV (NYSE:CX) is the least popular one with only 22 bullish hedge fund positions. Beyond Meat, Inc. (NASDAQ:BYND) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for BYND is 50.6. 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 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 12.3% in 2021 through April 19th and surpassed the market again by 0.9 percentage points. Unfortunately BYND wasn't nearly as popular as these 30 stocks (hedge fund sentiment was quite bearish); BYND investors were disappointed as the stock returned 8.2% since the end of December (through 4/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.
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