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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 Primoris Services Corp (NASDAQ:PRIM).
Is Primoris Services Corp (NASDAQ:PRIM) a buy, sell, or hold? The smart money was getting more bullish. The number of long hedge fund positions increased by 11 in recent months. Primoris Services Corp (NASDAQ:PRIM) was in 28 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic was previously 21. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that PRIM isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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Phillip Gross of Adage Capital
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Do Hedge Funds Think PRIM Is A Good Stock To Buy Now?
At the end of March, a total of 28 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 65% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards PRIM over the last 23 quarters. With hedge funds' positions undergoing their usual ebb and flow, there exists an "upper tier" of notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Chuck Royce's Royce & Associates has the number one position in Primoris Services Corp (NASDAQ:PRIM), worth close to $33.6 million, corresponding to 0.2% of its total 13F portfolio. The second largest stake is held by Phill Gross and Robert Atchinson of Adage Capital Management, with a $23.2 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds and institutional investors that are bullish comprise Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, Dan Rasmussen's Verdad Advisers and Tim Curro's Value Holdings LP. In terms of the portfolio weights assigned to each position Verdad Advisers allocated the biggest weight to Primoris Services Corp (NASDAQ:PRIM), around 5% of its 13F portfolio. Divisar Capital is also relatively very bullish on the stock, dishing out 4.08 percent of its 13F equity portfolio to PRIM.
With a general bullishness amongst the heavyweights, key hedge funds were breaking ground themselves. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the largest position in Primoris Services Corp (NASDAQ:PRIM). Adage Capital Management had $23.2 million invested in the company at the end of the quarter. Renaissance Technologies also initiated a $5.6 million position during the quarter. The following funds were also among the new PRIM investors: Frank Fu's CaaS Capital, Matthew L Pinz's Pinz Capital, and Benjamin A. Smith's Laurion Capital Management.
Let's now take a look at hedge fund activity in other stocks similar to Primoris Services Corp (NASDAQ:PRIM). We will take a look at Callon Petroleum Company (NYSE:CPE), BrightView Holdings, Inc. (NYSE:BV), Pandion Therapeutics Inc. (NASDAQ:PAND), AMTD International Inc. (NYSE:HKIB), Kronos Worldwide, Inc. (NYSE:KRO), Deluxe Corporation (NYSE:DLX), and Realogy Holdings Corp (NYSE:RLGY). This group of stocks' market caps are similar to PRIM's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CPE,16,94442,9 BV,11,219755,0 PAND,14,166657,4 HKIB,2,8546,1 KRO,9,31288,1 DLX,12,55786,-5 RLGY,22,257095,-4 Average,12.3,119081,0.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.3 hedge funds with bullish positions and the average amount invested in these stocks was $119 million. That figure was $164 million in PRIM's case. Realogy Holdings Corp (NYSE:RLGY) is the most popular stock in this table. On the other hand AMTD International Inc. (NYSE:HKIB) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Primoris Services Corp (NASDAQ:PRIM) is more popular among hedge funds. Our overall hedge fund sentiment score for PRIM 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 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 24% in 2021 through July 9th and still beat the market by 6.7 percentage points. Unfortunately PRIM wasn't nearly as popular as these 5 stocks and hedge funds that were betting on PRIM were disappointed as the stock returned -11.5% since the end of the first quarter (through 7/9) 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 since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.