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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Eventbrite, Inc. (NYSE:EB), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is EB stock a buy? Money managers were betting on the stock. The number of bullish hedge fund positions rose by 4 in recent months. Eventbrite, Inc. (NYSE:EB) was in 26 hedge funds' portfolios at the end of December. The all time high for this statistic is 25. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that EB isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings). There were 22 hedge funds in our database with EB holdings at the end of September.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).
Matthew Hulsizer of PEAK6 Capital
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. Keeping this in mind let's view the new hedge fund action encompassing Eventbrite, Inc. (NYSE:EB).
Do Hedge Funds Think EB Is A Good Stock To Buy Now?
At fourth quarter's end, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 18% from the previous quarter. By comparison, 24 hedge funds held shares or bullish call options in EB a year ago. With hedge funds' sentiment swirling, there exists a few noteworthy hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Cadian Capital, managed by Eric Bannasch, holds the most valuable position in Eventbrite, Inc. (NYSE:EB). Cadian Capital has a $83.8 million position in the stock, comprising 2.2% of its 13F portfolio. The second most bullish fund manager is Immersion Capital, managed by Michael Sidhom, which holds a $71.6 million position; the fund has 6.5% of its 13F portfolio invested in the stock. Remaining members of the smart money that are bullish include David Thomas's Atalan Capital, Cyrus de Weck's Portsea Asset Management and Eli Cohen's Crescent Park Management. In terms of the portfolio weights assigned to each position Portsea Asset Management allocated the biggest weight to Eventbrite, Inc. (NYSE:EB), around 14.38% of its 13F portfolio. Immersion Capital is also relatively very bullish on the stock, earmarking 6.52 percent of its 13F equity portfolio to EB.
As aggregate interest increased, key money managers were breaking ground themselves. Portsea Asset Management, managed by Cyrus de Weck, initiated the most valuable position in Eventbrite, Inc. (NYSE:EB). Portsea Asset Management had $23.6 million invested in the company at the end of the quarter. John Hurley's Cavalry Asset Management also made a $6.4 million investment in the stock during the quarter. The other funds with brand new EB positions are Matthew Hulsizer's PEAK6 Capital Management, Mario Cibelli's Marathon Partners, and Brandon Haley's Holocene Advisors.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Eventbrite, Inc. (NYSE:EB) but similarly valued. These stocks are Sapiens International Corporation N.V. (NASDAQ:SPNS), Endo International plc (NASDAQ:ENDP), Dicerna Pharmaceuticals Inc (NASDAQ:DRNA), Hercules Capital Inc (NYSE:HTGC), Virtus Investment Partners Inc (NASDAQ:VRTS), Hutchison China MediTech Limited (NASDAQ:HCM), and DiamondRock Hospitality Company (NYSE:DRH). This group of stocks' market values are similar to EB's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SPNS,14,63148,3 ENDP,13,420549,-4 DRNA,29,287941,-2 HTGC,12,42092,-1 VRTS,20,106385,6 HCM,6,34080,1 DRH,13,100472,-1 Average,15.3,150667,0.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 15.3 hedge funds with bullish positions and the average amount invested in these stocks was $151 million. That figure was $352 million in EB's case. Dicerna Pharmaceuticals Inc (NASDAQ:DRNA) is the most popular stock in this table. On the other hand Hutchison China MediTech Limited (NASDAQ:HCM) is the least popular one with only 6 bullish hedge fund positions. Eventbrite, Inc. (NYSE:EB) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for EB is 82.5. 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 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. Hedge funds were also right about betting on EB as the stock returned 21% since the end of Q4 (through 4/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.