In this article we will take a look at whether hedge funds think USANA Health Sciences, Inc. (NYSE:USNA) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.
Is USANA Health Sciences, Inc. (NYSE:USNA) a buy right now? The smart money was in a bearish mood. The number of long hedge fund positions fell by 3 recently. USANA Health Sciences, Inc. (NYSE:USNA) was in 19 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 22. Our calculations also showed that USNA isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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Do Hedge Funds Think USNA Is A Good Stock To Buy Now?
At first quarter's end, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of -14% from the previous quarter. The graph below displays the number of hedge funds with bullish position in USNA over the last 23 quarters. With hedgies' capital changing hands, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
The largest stake in USANA Health Sciences, Inc. (NYSE:USNA) was held by Renaissance Technologies, which reported holding $153 million worth of stock at the end of December. It was followed by Arrowstreet Capital with a $22 million position. Other investors bullish on the company included D E Shaw, GLG Partners, and CaaS Capital. In terms of the portfolio weights assigned to each position Prescott Group Capital Management allocated the biggest weight to USANA Health Sciences, Inc. (NYSE:USNA), around 0.74% of its 13F portfolio. Algert Global is also relatively very bullish on the stock, dishing out 0.31 percent of its 13F equity portfolio to USNA.
Seeing as USANA Health Sciences, Inc. (NYSE:USNA) has witnessed bearish sentiment from the entirety of the hedge funds we track, it's easy to see that there exists a select few fund managers who were dropping their positions entirely last quarter. Interestingly, Valerie Malter's Matarin Capital dropped the largest position of all the hedgies monitored by Insider Monkey, worth close to $3.2 million in stock. David Harding's fund, Winton Capital Management, also cut its stock, about $1.7 million worth. These moves are interesting, as total hedge fund interest was cut by 3 funds last quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as USANA Health Sciences, Inc. (NYSE:USNA) but similarly valued. We will take a look at Century Communities, Inc (NYSE:CCS), The RealReal, Inc. (NASDAQ:REAL), Chesapeake Utilities Corporation (NYSE:CPK), EHang Holdings Limited (NASDAQ:EH), Liberty Oilfield Services Inc. (NYSE:LBRT), bluebird bio Inc (NASDAQ:BLUE), and Talend S.A. (NASDAQ:TLND). This group of stocks' market values resemble USNA's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CCS,24,123486,6 REAL,24,399233,-8 CPK,6,6692,2 EH,4,7063,2 LBRT,10,41393,2 BLUE,27,226229,-1 TLND,45,1142089,18 Average,20,278026,3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $278 million. That figure was $250 million in USNA's case. Talend S.A. (NASDAQ:TLND) is the most popular stock in this table. On the other hand EHang Holdings Limited (NASDAQ:EH) is the least popular one with only 4 bullish hedge fund positions. USANA Health Sciences, Inc. (NYSE:USNA) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for USNA is 46.2. 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 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately USNA wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); USNA investors were disappointed as the stock returned 2.3% since the end of March (through 7/16) 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.