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The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 817 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider Endurance International Group Holdings Inc (NASDAQ:EIGI) for your portfolio? We'll look to this invaluable collective wisdom for the answer.
Is EIGI a good stock to buy now? Investors who are in the know were taking an optimistic view. The number of bullish hedge fund bets moved up by 1 lately. Endurance International Group Holdings Inc (NASDAQ:EIGI) was in 16 hedge funds' portfolios at the end of September. The all time high for this statistic is 18. Our calculations also showed that EIGI 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.
To most shareholders, hedge funds are assumed to be unimportant, outdated investment vehicles of yesteryear. While there are over 8000 funds in operation at the moment, Our experts choose to focus on the leaders of this group, approximately 850 funds. It is estimated that this group of investors preside over most of the smart money's total capital, and by monitoring their first-class picks, Insider Monkey has revealed several investment strategies that have historically outrun the broader indices. Insider Monkey's flagship short hedge fund strategy outstripped 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 .
Ahmet Okumus of Okumus Fund Management
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 15 best blue chip stocks 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 look at the new hedge fund action encompassing Endurance International Group Holdings Inc (NASDAQ:EIGI).
Do Hedge Funds Think EIGI Is A Good Stock To Buy Now?
At Q3's end, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 7% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards EIGI over the last 21 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Okumus Fund Management was the largest shareholder of Endurance International Group Holdings Inc (NASDAQ:EIGI), with a stake worth $45.2 million reported as of the end of September. Trailing Okumus Fund Management was Renaissance Technologies, which amassed a stake valued at $21.6 million. D E Shaw, Arrowstreet Capital, and Millennium Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Okumus Fund Management allocated the biggest weight to Endurance International Group Holdings Inc (NASDAQ:EIGI), around 64.33% of its 13F portfolio. Diametric Capital is also relatively very bullish on the stock, designating 0.32 percent of its 13F equity portfolio to EIGI.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls' herd. ExodusPoint Capital, managed by Michael Gelband, initiated the most valuable position in Endurance International Group Holdings Inc (NASDAQ:EIGI). ExodusPoint Capital had $0.6 million invested in the company at the end of the quarter. Nick Thakore's Diametric Capital also initiated a $0.4 million position during the quarter. The other funds with brand new EIGI positions are Noam Gottesman's GLG Partners, Alec Litowitz and Ross Laser's Magnetar Capital, and Gavin Saitowitz and Cisco J. del Valle's Prelude Capital (previously Springbok Capital).
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Endurance International Group Holdings Inc (NASDAQ:EIGI) but similarly valued. These stocks are Southside Bancshares, Inc. (NASDAQ:SBSI), Provident Financial Services, Inc. (NYSE:PFS), Pliant Therapeutics, Inc. (NASDAQ:PLRX), National Bank Holdings Corp (NYSE:NBHC), Taysha Gene Therapies, Inc. (NASDAQ:TSHA), ATN International, Inc. (NASDAQ:ATNI), and Twin River Worldwide Holdings Inc. (NYSE:TRWH). This group of stocks' market values match EIGI's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SBSI,8,31525,-3 PFS,10,18111,0 PLRX,11,157744,-2 NBHC,6,45405,1 TSHA,15,72542,15 ATNI,9,47619,1 TRWH,17,164279,-1 Average,10.9,76746,1.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 10.9 hedge funds with bullish positions and the average amount invested in these stocks was $77 million. That figure was $95 million in EIGI's case. Twin River Worldwide Holdings Inc. (NYSE:TRWH) is the most popular stock in this table. On the other hand National Bank Holdings Corp (NYSE:NBHC) is the least popular one with only 6 bullish hedge fund positions. Endurance International Group Holdings Inc (NASDAQ:EIGI) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for EIGI is 78.1. 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. 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 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. Hedge funds were also right about betting on EIGI as the stock returned 64.5% since the end of Q3 (through 12/14) 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.