Is GreenPower Motor Company Inc. (NASDAQ:GP) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.
Is GP a good stock to buy? GreenPower Motor Company Inc. (NASDAQ:GP) shares haven't seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 4 hedge funds' portfolios at the end of the first quarter of 2021. Our calculations also showed that GP isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings). The level and the change in hedge fund popularity aren't the only variables you need to analyze to decipher hedge funds' perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That's why at the end of this article we will examine companies such as Global Ship Lease, Inc. (NYSE:GSL), W&T Offshore, Inc. (NYSE:WTI), and Kandi Technolgies Group Inc. (NASDAQ:KNDI) to gather more data points.
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Donald Sussman of Paloma Partners
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Do Hedge Funds Think GP Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the previous quarter. By comparison, 0 hedge funds held shares or bullish call options in GP a year ago. With the smart money's sentiment swirling, there exists an "upper tier" of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the number one position in GreenPower Motor Company Inc. (NASDAQ:GP). Citadel Investment Group has a $1.1 million call position in the stock, comprising less than 0.1%% of its 13F portfolio. On Citadel Investment Group's heels is Israel Englander of Millennium Management, with a $1.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions contain Michael Gelband's ExodusPoint Capital, Donald Sussman's Paloma Partners and Ken Griffin's Citadel Investment Group. In terms of the portfolio weights assigned to each position ExodusPoint Capital allocated the biggest weight to GreenPower Motor Company Inc. (NASDAQ:GP), around 0.01% of its 13F portfolio. Paloma Partners is also relatively very bullish on the stock, earmarking 0.01 percent of its 13F equity portfolio to GP.
Due to the fact that GreenPower Motor Company Inc. (NASDAQ:GP) has faced falling interest from the aggregate hedge fund industry, it's safe to say that there exists a select few hedgies that elected to cut their full holdings last quarter. At the top of the heap, Till Bechtolsheimer's Arosa Capital Management dropped the largest stake of the "upper crust" of funds followed by Insider Monkey, valued at about $4.1 million in stock, and John Overdeck and David Siegel's Two Sigma Advisors was right behind this move, as the fund said goodbye to about $1.4 million worth. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as GreenPower Motor Company Inc. (NASDAQ:GP) but similarly valued. We will take a look at Global Ship Lease, Inc. (NYSE:GSL), W&T Offshore, Inc. (NYSE:WTI), Kandi Technolgies Group Inc. (NASDAQ:KNDI), Tidewater Inc. (NYSE:TDW), Alerus Financial Corporation (NASDAQ:ALRS), Unifi, Inc. (NYSE:UFI), and Gamco Investors Inc. (NYSE:GBL). This group of stocks' market caps are closest to GP's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position GSL,11,48076,9 WTI,13,24610,2 KNDI,8,10637,0 TDW,9,77695,0 ALRS,1,454,0 UFI,13,116426,-2 GBL,4,9541,-3 Average,8.4,41063,0.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 8.4 hedge funds with bullish positions and the average amount invested in these stocks was $41 million. That figure was $2 million in GP's case. W&T Offshore, Inc. (NYSE:WTI) is the most popular stock in this table. On the other hand Alerus Financial Corporation (NASDAQ:ALRS) is the least popular one with only 1 bullish hedge fund positions. GreenPower Motor Company Inc. (NASDAQ:GP) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for GP is 47.5. 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. 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 17.2% in 2021 through June 11th and surpassed the market again by 3.3 percentage points. Unfortunately GP wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); GP investors were disappointed as the stock returned -30.1% since the end of March (through 6/11) 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.