After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of June 28. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Nu Skin Enterprises, Inc. (NYSE:NUS).
Is Nu Skin Enterprises, Inc. (NYSE:NUS) ready to rally soon? The smart money is taking a bearish view. The number of bullish hedge fund positions shrunk by 3 lately. Our calculations also showed that NUS isn't among the 30 most popular stocks among hedge funds (view the video below). NUS was in 20 hedge funds' portfolios at the end of June. There were 23 hedge funds in our database with NUS positions at the end of the previous quarter. Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the 21st century investor’s toolkit there are plenty of formulas shareholders put to use to assess their holdings. A couple of the best formulas are hedge fund and insider trading moves. We have shown that, historically, those who follow the top picks of the best investment managers can outperform the broader indices by a solid margin (see the details here).
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn't rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let's take a look at the new hedge fund action encompassing Nu Skin Enterprises, Inc. (NYSE:NUS).
Hedge fund activity in Nu Skin Enterprises, Inc. (NYSE:NUS)
At the end of the second quarter, a total of 20 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from the previous quarter. On the other hand, there were a total of 18 hedge funds with a bullish position in NUS a year ago. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Renaissance Technologies holds the biggest position in Nu Skin Enterprises, Inc. (NYSE:NUS). Renaissance Technologies has a $72.9 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by D E Shaw, managed by D. E. Shaw, which holds a $59.8 million position; 0.1% of its 13F portfolio is allocated to the stock. Other professional money managers with similar optimism comprise Cliff Asness's AQR Capital Management, Ken Griffin's Citadel Investment Group and Israel Englander's Millennium Management.
Since Nu Skin Enterprises, Inc. (NYSE:NUS) has experienced declining sentiment from the aggregate hedge fund industry, it's safe to say that there lies a certain "tier" of hedgies that slashed their entire stakes in the second quarter. Interestingly, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital dumped the biggest stake of the 750 funds monitored by Insider Monkey, valued at about $8.7 million in stock, and Paul Tudor Jones's Tudor Investment Corp was right behind this move, as the fund cut about $3 million worth. These transactions are interesting, as aggregate hedge fund interest dropped by 3 funds in the second quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Nu Skin Enterprises, Inc. (NYSE:NUS) but similarly valued. We will take a look at International Game Technology PLC (NYSE:IGT), Chart Industries, Inc. (NASDAQ:GTLS), Yelp Inc (NYSE:YELP), and Workiva Inc (NYSE:WK). This group of stocks' market valuations match NUS's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IGT,30,280456,-2 GTLS,24,416483,4 YELP,27,471213,-6 WK,20,245012,3 Average,25.25,353291,-0.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.25 hedge funds with bullish positions and the average amount invested in these stocks was $353 million. That figure was $283 million in NUS's case. International Game Technology PLC (NYSE:IGT) is the most popular stock in this table. On the other hand Workiva Inc (NYSE:WK) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks Nu Skin Enterprises, Inc. (NYSE:NUS) is even less popular than WK. Hedge funds dodged a bullet by taking a bearish stance towards NUS. Our calculations showed that the top 20 most popular hedge fund stocks returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately NUS wasn't nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); NUS investors were disappointed as the stock returned -13% during the third 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 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far in 2019.
Disclosure: None. This article was originally published at Insider Monkey.