- Oops!Something went wrong.Please try again later.
The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider Envestnet Inc (NYSE:ENV) for your portfolio? We'll look to this invaluable collective wisdom for the answer.
Envestnet Inc (NYSE:ENV) investors should be aware of a decrease in activity from the world's largest hedge funds lately. Envestnet Inc (NYSE:ENV) was in 18 hedge funds' portfolios at the end of March. The all time high for this statistic is 28. Our calculations also showed that ENV isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
David Siegel of Two Sigma Advisors
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind let's take a peek at the new hedge fund action regarding Envestnet Inc (NYSE:ENV).
Do Hedge Funds Think ENV Is A Good Stock To Buy Now?
At Q1's end, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -36% from the fourth quarter of 2020. The graph below displays the number of hedge funds with bullish position in ENV over the last 23 quarters. With hedge funds' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Echo Street Capital Management, managed by Greg Poole, holds the number one position in Envestnet Inc (NYSE:ENV). Echo Street Capital Management has a $121.3 million position in the stock, comprising 1.1% of its 13F portfolio. The second most bullish fund manager is LMR Partners, managed by Ben Levine, Andrew Manuel and Stefan Renold, which holds a $30.8 million position; 0.8% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish contain Ken Griffin's Citadel Investment Group, Israel Englander's Millennium Management and Brandon Haley's Holocene Advisors. In terms of the portfolio weights assigned to each position Echo Street Capital Management allocated the biggest weight to Envestnet Inc (NYSE:ENV), around 1.08% of its 13F portfolio. LMR Partners is also relatively very bullish on the stock, designating 0.77 percent of its 13F equity portfolio to ENV.
Since Envestnet Inc (NYSE:ENV) has faced a decline in interest from the aggregate hedge fund industry, it's safe to say that there exists a select few fund managers that elected to cut their positions entirely last quarter. It's worth mentioning that D. E. Shaw's D E Shaw said goodbye to the biggest investment of all the hedgies followed by Insider Monkey, worth close to $38.4 million in stock. James Dinan's fund, York Capital Management, also dropped its stock, about $20.1 million worth. These transactions are interesting, as total hedge fund interest was cut by 10 funds last quarter.
Let's check out hedge fund activity in other stocks similar to Envestnet Inc (NYSE:ENV). We will take a look at Tilray, Inc. (NASDAQ:TLRY), Murphy USA Inc. (NYSE:MUSA), SeaWorld Entertainment Inc (NYSE:SEAS), Millicom International Cellular S.A. (NASDAQ:TIGO), Progyny, Inc. (NASDAQ:PGNY), New Relic Inc (NYSE:NEWR), and EnerSys (NYSE:ENS). This group of stocks' market valuations are similar to ENV's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TLRY,21,257933,4 MUSA,19,264778,-7 SEAS,39,1881920,6 TIGO,5,42136,-1 PGNY,26,221476,2 NEWR,27,1141779,-3 ENS,28,119582,4 Average,23.6,561372,0.7 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.6 hedge funds with bullish positions and the average amount invested in these stocks was $561 million. That figure was $211 million in ENV's case. SeaWorld Entertainment Inc (NYSE:SEAS) is the most popular stock in this table. On the other hand Millicom International Cellular S.A. (NASDAQ:TIGO) is the least popular one with only 5 bullish hedge fund positions. Envestnet Inc (NYSE:ENV) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ENV is 33.4. 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 28.5% in 2021 through July 23rd and surpassed the market again by 10.1 percentage points. Unfortunately ENV wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); ENV investors were disappointed as the stock returned 3.3% since the end of March (through 7/23) 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.
Get real-time email alerts: Follow Envestnet Inc. (NYSE:ENV)
Disclosure: None. This article was originally published at Insider Monkey.