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 at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of March 31st, a week after the market trough. We are almost done with the second quarter. Investors decided to bet on the economic recovery and a stock market rebound. S&P 500 Index returned almost 20% this quarter. In this article we look at how hedge funds traded Univest Financial Corporation (NASDAQ:UVSP) and determine whether the smart money was really smart about this stock.
Univest Financial Corporation (NASDAQ:UVSP) was in 11 hedge funds' portfolios at the end of March. UVSP investors should pay attention to a decrease in hedge fund interest in recent months. There were 13 hedge funds in our database with UVSP positions at the end of the previous quarter. Our calculations also showed that UVSP 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 21st century investor’s toolkit there are a large number of indicators stock market investors put to use to value stocks. Some of the most innovative indicators are hedge fund and insider trading moves. Our experts have shown that, historically, those who follow the best picks of the best fund managers can trounce the S&P 500 by a very impressive amount (see the details here).
[caption id="attachment_338852" align="aligncenter" width="400"] Richard S. Pzena of Pzena Investment Management[/caption]
At Insider Monkey we scour multiple sources to uncover the next great investment idea. There is a lot of volatility in the markets and this presents amazing investment opportunities from time to time. For example, this trader claims to deliver juiced up returns with one trade a week, so we are checking out his highest conviction idea. A second trader claims to score lucrative profits by utilizing a "weekend trading strategy", so we look into his strategy's picks. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We recently recommended several stocks partly inspired by legendary Bill Miller's investor letter. 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. Keeping this in mind we're going to take a look at the recent hedge fund action regarding Univest Financial Corporation (NASDAQ:UVSP).
How have hedgies been trading Univest Financial Corporation (NASDAQ:UVSP)?
At the end of the first quarter, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -15% from the previous quarter. By comparison, 9 hedge funds held shares or bullish call options in UVSP a year ago. With the smart money's capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their holdings considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Richard S. Pzena's Pzena Investment Management has the biggest position in Univest Financial Corporation (NASDAQ:UVSP), worth close to $24 million, accounting for 0.2% of its total 13F portfolio. Coming in second is Renaissance Technologies, which holds a $19.7 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining members of the smart money that are bullish include Ian Simm's Impax Asset Management, John Overdeck and David Siegel's Two Sigma Advisors and D. E. Shaw's D E Shaw. In terms of the portfolio weights assigned to each position Pzena Investment Management allocated the biggest weight to Univest Financial Corporation (NASDAQ:UVSP), around 0.18% of its 13F portfolio. Algert Coldiron Investors is also relatively very bullish on the stock, designating 0.16 percent of its 13F equity portfolio to UVSP.
Judging by the fact that Univest Financial Corporation (NASDAQ:UVSP) has witnessed bearish sentiment from hedge fund managers, it's safe to say that there is a sect of funds that slashed their entire stakes heading into Q4. Interestingly, Israel Englander's Millennium Management said goodbye to the largest stake of all the hedgies tracked by Insider Monkey, comprising close to $2.3 million in stock. Paul Marshall and Ian Wace's fund, Marshall Wace LLP, also dropped its stock, about $1.4 million worth. These transactions are interesting, as total hedge fund interest fell by 2 funds heading into Q4.
Let's go over hedge fund activity in other stocks similar to Univest Financial Corporation (NASDAQ:UVSP). These stocks are iHeartMedia, Inc. (NASDAQ:IHRT), SP Plus Corp (NASDAQ:SP), Camden National Corporation (NASDAQ:CAC), and Mercer International Inc. (NASDAQ:MERC). This group of stocks' market values match UVSP's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IHRT,28,106885,-3 SP,11,65053,-2 CAC,10,43580,-3 MERC,10,84956,-4 Average,14.75,75119,-3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.75 hedge funds with bullish positions and the average amount invested in these stocks was $75 million. That figure was $55 million in UVSP's case. iHeartMedia, Inc. (NASDAQ:IHRT) is the most popular stock in this table. On the other hand Camden National Corporation (NASDAQ:CAC) is the least popular one with only 10 bullish hedge fund positions. Univest Financial Corporation (NASDAQ:UVSP) is not the least popular stock in this group but hedge fund interest is still below average. 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 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 gained 12.3% in 2020 through June 30th and surpassed the market by 15.5 percentage points. Unfortunately UVSP wasn't nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); UVSP investors were disappointed as the stock returned 0.1% during the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.