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 PGT Innovations Inc. (NASDAQ:PGTI).
PGT Innovations Inc. (NASDAQ:PGTI) was in 14 hedge funds' portfolios at the end of the first quarter of 2020. PGTI shareholders have witnessed an increase in hedge fund sentiment lately. There were 10 hedge funds in our database with PGTI holdings at the end of the previous quarter. Our calculations also showed that PGTI isn't among the 30 most popular stocks among hedge funds (click for Q1 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.
In the eyes of most traders, hedge funds are viewed as unimportant, old financial tools of the past. While there are greater than 8000 funds in operation today, Our experts hone in on the bigwigs of this club, approximately 850 funds. These money managers handle the lion's share of the smart money's total asset base, and by tracking their finest stock picks, Insider Monkey has come up with many investment strategies that have historically outrun the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
[caption id="attachment_26073" align="aligncenter" width="400"] Jim Simons of Renaissance Technologies[/caption]
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology's influence will go beyond online payments. So, we are checking out this futurist's moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let's take a glance at the recent hedge fund action regarding PGT Innovations Inc. (NASDAQ:PGTI).
What have hedge funds been doing with PGT Innovations Inc. (NASDAQ:PGTI)?
At the end of the first quarter, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 40% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards PGTI over the last 18 quarters. With hedge funds' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
The largest stake in PGT Innovations Inc. (NASDAQ:PGTI) was held by Renaissance Technologies, which reported holding $26.4 million worth of stock at the end of September. It was followed by Royce & Associates with a $4.2 million position. Other investors bullish on the company included Broad Bay Capital, Two Sigma Advisors, and Balyasny Asset Management. In terms of the portfolio weights assigned to each position AlphaOne Capital Partners allocated the biggest weight to PGT Innovations Inc. (NASDAQ:PGTI), around 0.6% of its 13F portfolio. Broad Bay Capital is also relatively very bullish on the stock, setting aside 0.45 percent of its 13F equity portfolio to PGTI.
Now, some big names were breaking ground themselves. Balyasny Asset Management, managed by Dmitry Balyasny, created the most valuable position in PGT Innovations Inc. (NASDAQ:PGTI). Balyasny Asset Management had $0.5 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital also initiated a $0.5 million position during the quarter. The other funds with new positions in the stock are Jonathan Soros's JS Capital and Matthew Hulsizer's PEAK6 Capital Management.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as PGT Innovations Inc. (NASDAQ:PGTI) but similarly valued. These stocks are Globalstar, Inc. (PINK:GSAT), Criteo SA (NASDAQ:CRTO), Allegiance Bancshares, Inc. (NASDAQ:ABTX), and Ennis, Inc. (NYSE:EBF). This group of stocks' market valuations match PGTI's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position GSAT,12,55702,0 CRTO,13,64427,3 ABTX,6,6471,-1 EBF,9,62731,-2 Average,10,47333,0 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $47 million. That figure was $37 million in PGTI's case. Criteo SA (NASDAQ:CRTO) is the most popular stock in this table. On the other hand Allegiance Bancshares, Inc. (NASDAQ:ABTX) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks PGT Innovations Inc. (NASDAQ:PGTI) is more popular among hedge funds. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks returned 13.3% in 2020 through June 25th but still managed to beat the market by 16.8 percentage points. Hedge funds were also right about betting on PGTI as the stock returned 77.1% so far in Q2 (through June 25th) 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.
Disclosure: None. This article was originally published at Insider Monkey.