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Is Global-E Online Ltd. (GLBE) A Good Stock To Buy Now?

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  • GLBE

In this article we will check out the progression of hedge fund sentiment towards Global-E Online Ltd. (NASDAQ:GLBE) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.

Is Global-E Online Ltd. (GLBE) a good stock to buy now? Investors who are in the know were becoming more confident. The number of bullish hedge fund bets inched up by 22 recently. Global-E Online Ltd. (NASDAQ:GLBE) was in 22 hedge funds' portfolios at the end of the third quarter of 2021. Our calculations also showed that GLBE isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV 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. Now let's check out the recent hedge fund action surrounding Global-E Online Ltd. (NASDAQ:GLBE).

Colin Moran Abdiel Capital
Colin Moran Abdiel Capital

Colin Moran of Abdiel Capital Advisors

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

At Q3's end, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 22 from the previous quarter. Below, you can check out the change in hedge fund sentiment towards GLBE over the last 25 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, Abdiel Capital Advisors held the most valuable stake in Global-E Online Ltd. (NASDAQ:GLBE), which was worth $369.7 million at the end of the third quarter. On the second spot was Spruce House Investment Management which amassed $147 million worth of shares. Zevenbergen Capital Investments, Whale Rock Capital Management, and Holocene Advisors 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 Abdiel Capital Advisors allocated the biggest weight to Global-E Online Ltd. (NASDAQ:GLBE), around 9.1% of its 13F portfolio. Spruce House Investment Management is also relatively very bullish on the stock, setting aside 3.81 percent of its 13F equity portfolio to GLBE.

Now, key hedge funds were breaking ground themselves. Abdiel Capital Advisors, managed by Colin Moran, created the largest position in Global-E Online Ltd. (NASDAQ:GLBE). Abdiel Capital Advisors had $369.7 million invested in the company at the end of the quarter. Brandon Haley's Holocene Advisors also made a $84.5 million investment in the stock during the quarter. The other funds with brand new GLBE positions are Andrew Immerman and Jeremy Schiffman's Palestra Capital Management, Joseph Samuels's Islet Management, and Michael Rockefeller and KarláKroeker's Woodline Partners.

Let's now take a look at hedge fund activity in other stocks similar to Global-E Online Ltd. (NASDAQ:GLBE). These stocks are Natera Inc (NASDAQ:NTRA), The Toro Company (NYSE:TTC), Vereit Inc (NYSE:VER), Carlisle Companies, Inc. (NYSE:CSL), BorgWarner Inc. (NYSE:BWA), Pegasystems Inc. (NASDAQ:PEGA), and IAC/InterActiveCorp (NASDAQ:IAC). All of these stocks' market caps match GLBE's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NTRA,50,1800268,-2 TTC,29,894310,-3 VER,22,946495,0 CSL,14,89365,-3 BWA,21,170260,-6 PEGA,25,1891439,-2 IAC,47,1426626,-3 Average,29.7,1031252,-2.7 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 29.7 hedge funds with bullish positions and the average amount invested in these stocks was $1031 million. That figure was $1002 million in GLBE's case. Natera Inc (NASDAQ:NTRA) is the most popular stock in this table. On the other hand Carlisle Companies, Inc. (NYSE:CSL) is the least popular one with only 14 bullish hedge fund positions. Global-E Online Ltd. (NASDAQ:GLBE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for GLBE is 27.8. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and surpassed the market again by 3.6 percentage points. Unfortunately GLBE wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); GLBE investors were disappointed as the stock returned -11.7% since the end of September (through 12/31) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.

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Disclosure: None. This article was originally published at Insider Monkey.