U.S. Markets close in 1 hr 36 mins

Hedge Funds Have Never Been This Bullish On Euronet Worldwide, Inc. (EEFT)

Nina Todic

Is Euronet Worldwide, Inc. (NASDAQ:EEFT) an attractive investment right now? Money managers are in an optimistic mood. The number of long hedge fund positions moved up by 7 recently.EEFT was in 31 hedge funds' portfolios at the end of the fourth quarter of 2018. Overall hedge fund sentiment towards the stock is at its all time high. This is usually a bullish sign. For example hedge fund sentiment in Xilinx Inc. (XLNX) was also at its all time high at the beginning of this year and the stock returned more than 46% in 2.5 months. We observed similar performances from OKTATwilioCCKMSCIMASI and Progressive Corporation (PGR); these stocks returned 37%, 37%, 35%, 29%, 28% and 27% respectively. Hedge fund sentiment towards IQVIA Holdings Inc. (IQV)Brookfield Asset Management (BAM)Atlassian Corporation (TEAM)RCLMTBVARRNGFIVEECASBNY, KL and CRH hit all time highs at the end of December, and all of these stocks returned more than 20% in the first 2.5-3 months of this year.

Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Dmitry Balyasny

We're going to take a peek at the fresh hedge fund action surrounding Euronet Worldwide, Inc. (NASDAQ:EEFT).

Hedge fund activity in Euronet Worldwide, Inc. (NASDAQ:EEFT)

Heading into the first quarter of 2019, a total of 31 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 29% from the previous quarter. By comparison, 25 hedge funds held shares or bullish call options in EEFT a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

EEFT

Among these funds, Renaissance Technologies held the most valuable stake in Euronet Worldwide, Inc. (NASDAQ:EEFT), which was worth $28 million at the end of the third quarter. On the second spot was Greenhouse Funds which amassed $25.4 million worth of shares. Moreover, Balyasny Asset Management, Crosslink Capital, and Portolan Capital Management were also bullish on Euronet Worldwide, Inc. (NASDAQ:EEFT), allocating a large percentage of their portfolios to this stock.

As one would reasonably expect, specific money managers were leading the bulls' herd. Garelick Capital Partners, managed by Bruce Garelick, initiated the biggest position in Euronet Worldwide, Inc. (NASDAQ:EEFT). Garelick Capital Partners had $11.9 million invested in the company at the end of the quarter. Principal Global Investors's Columbus Circle Investors also initiated a $9.9 million position during the quarter. The other funds with new positions in the stock are Bruce Emery's Greenvale Capital, Joel Greenblatt's Gotham Asset Management, and Matthew Hulsizer's PEAK6 Capital Management.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position YPF,15,213817,-2 PRGO,23,556413,2 HTA,17,394094,1 PK,17,482603,2 Average,18,411732,0.75 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $412 million. That figure was $215 million in EEFT's case. Perrigo Company (NYSE:PRGO) is the most popular stock in this table. On the other hand YPF Sociedad Anonima (NYSE:YPF) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks Euronet Worldwide, Inc. (NASDAQ:EEFT) is more popular among hedge funds. Our calculations showed that top 15 most popular stocks among hedge funds returned 21.3% through April 8th and outperformed the S&P 500 ETF (SPY) by more than 5 percentage points. Hedge funds were also right about betting on EEFT as the stock returned 40.2% and outperformed the market as well.

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

Related Content