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Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors' consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Equitable Holdings, Inc. (NYSE:EQH).
Is EQH stock a buy or sell? Equitable Holdings, Inc. (NYSE:EQH) was in 46 hedge funds' portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 39. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. EQH investors should be aware of an increase in hedge fund interest recently. There were 36 hedge funds in our database with EQH positions at the end of the third quarter. Our calculations also showed that EQH isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 124 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
John Petry of Sessa Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best hydrogen fuel cell 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 (or at the end of this article). With all of this in mind let's take a glance at the recent hedge fund action surrounding Equitable Holdings, Inc. (NYSE:EQH).
Do Hedge Funds Think EQH Is A Good Stock To Buy Now?
At the end of December, a total of 46 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 28% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards EQH over the last 22 quarters. With hedgies' capital changing hands, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
According to Insider Monkey's hedge fund database, Pzena Investment Management, managed by Richard S. Pzena, holds the most valuable position in Equitable Holdings, Inc. (NYSE:EQH). Pzena Investment Management has a $503.3 million position in the stock, comprising 2.4% of its 13F portfolio. The second most bullish fund manager is Sessa Capital, led by John Petry, holding a $127 million position; the fund has 8.1% of its 13F portfolio invested in the stock. Other professional money managers that are bullish include Andreas Halvorsen's Viking Global, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital and Ken Griffin's Citadel Investment Group. In terms of the portfolio weights assigned to each position Soapstone Capital allocated the biggest weight to Equitable Holdings, Inc. (NYSE:EQH), around 12.12% of its 13F portfolio. Sessa Capital is also relatively very bullish on the stock, setting aside 8.13 percent of its 13F equity portfolio to EQH.
As one would reasonably expect, some big names have jumped into Equitable Holdings, Inc. (NYSE:EQH) headfirst. Viking Global, managed by Andreas Halvorsen, established the largest position in Equitable Holdings, Inc. (NYSE:EQH). Viking Global had $99.1 million invested in the company at the end of the quarter. Louis Bacon's Moore Global Investments also made a $23.7 million investment in the stock during the quarter. The other funds with new positions in the stock are Viraj Mehta's Arctis Global, Allon Hellmann's Full18 Capital, and Ryan Tolkin (CIO)'s Schonfeld Strategic Advisors.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Equitable Holdings, Inc. (NYSE:EQH) but similarly valued. We will take a look at Appian Corporation (NASDAQ:APPN), UDR, Inc. (NYSE:UDR), Yatsen Holding Limited (NYSE:YSG), Whirlpool Corporation (NYSE:WHR), Kirkland Lake Gold Ltd. (NYSE:KL), Vail Resorts, Inc. (NYSE:MTN), and Apollo Global Management Inc (NYSE:APO). This group of stocks' market caps are similar to EQH's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position APPN,24,1163680,9 UDR,23,482699,-3 YSG,26,310970,26 WHR,32,1050870,4 KL,24,498090,2 MTN,31,937968,1 APO,30,2052942,2 Average,27.1,928174,5.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 27.1 hedge funds with bullish positions and the average amount invested in these stocks was $928 million. That figure was $1270 million in EQH's case. Whirlpool Corporation (NYSE:WHR) is the most popular stock in this table. On the other hand UDR, Inc. (NYSE:UDR) is the least popular one with only 23 bullish hedge fund positions. Compared to these stocks Equitable Holdings, Inc. (NYSE:EQH) is more popular among hedge funds. Our overall hedge fund sentiment score for EQH is 90. 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 returned 5.3% in 2021 through March 19th but still managed to beat the market by 0.8 percentage points. Hedge funds were also right about betting on EQH as the stock returned 28.2% since the end of December (through 3/19) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.