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Is NVGS A Good Stock To Buy Now?

·6 min read

We at Insider Monkey have gone over 817 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of September 30th. In this article, we look at what those funds think of Navigator Holdings Ltd (NYSE:NVGS) based on that data.

Is NVGS a good stock to buy now? Navigator Holdings Ltd (NYSE:NVGS) has seen an increase in support from the world's most elite money managers recently. Navigator Holdings Ltd (NYSE:NVGS) was in 16 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistic is 16. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 14 hedge funds in our database with NVGS positions at the end of the second quarter. Our calculations also showed that NVGS isn't among the 30 most popular stocks among hedge funds (click for Q3 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In the eyes of most shareholders, hedge funds are perceived as slow, outdated investment vehicles of years past. While there are greater than 8000 funds with their doors open at the moment, We hone in on the upper echelon of this group, approximately 850 funds. These hedge fund managers have their hands on the lion's share of the smart money's total capital, and by keeping an eye on their matchless stock picks, Insider Monkey has uncovered a few investment strategies that have historically exceeded the S&P 500 index. Insider Monkey's flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .

Mario Gabelli of GAMCO Investors

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. 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 website. Now we're going to go over the recent hedge fund action regarding Navigator Holdings Ltd (NYSE:NVGS).

Do Hedge Funds Think NVGS Is A Good Stock To Buy Now?

Heading into the fourth quarter of 2020, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from one quarter earlier. By comparison, 16 hedge funds held shares or bullish call options in NVGS a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, Royce & Associates, managed by Chuck Royce, holds the biggest position in Navigator Holdings Ltd (NYSE:NVGS). Royce & Associates has a $10.4 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Murray Stahl of Horizon Asset Management, with a $7.5 million position; 0.3% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors with similar optimism consist of Renaissance Technologies, Mario Gabelli's GAMCO Investors and David P. Cohen's Minerva Advisors. In terms of the portfolio weights assigned to each position Minerva Advisors allocated the biggest weight to Navigator Holdings Ltd (NYSE:NVGS), around 1.92% of its 13F portfolio. Horizon Asset Management is also relatively very bullish on the stock, setting aside 0.3 percent of its 13F equity portfolio to NVGS.

As aggregate interest increased, some big names have jumped into Navigator Holdings Ltd (NYSE:NVGS) headfirst. Beech Hill Partners, managed by Paul Cantor, Joseph Weiss, and Will Wurm, assembled the largest position in Navigator Holdings Ltd (NYSE:NVGS). Beech Hill Partners had $0.1 million invested in the company at the end of the quarter. Gavin Saitowitz and Cisco J. del Valle's Prelude Capital (previously Springbok Capital) also initiated a $0 million position during the quarter.

Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Navigator Holdings Ltd (NYSE:NVGS) but similarly valued. We will take a look at Clear Channel Outdoor Holdings, Inc. (NYSE:CCO), AxoGen, Inc. (NASDAQ:AXGN), Applied Therapeutics, Inc. (NASDAQ:APLT), Brookdale Senior Living, Inc. (NYSE:BKD), Pacific Ethanol Inc (NASDAQ:PEIX), WisdomTree Investments, Inc. (NASDAQ:WETF), and Renalytix AI plc (NASDAQ:RNLX). This group of stocks' market valuations resemble NVGS's market valuation.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CCO,30,121256,3 AXGN,15,43436,3 APLT,8,100284,-6 BKD,20,181384,-4 PEIX,11,81327,8 WETF,22,34490,4 RNLX,4,16709,4 Average,15.7,82698,1.7 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 15.7 hedge funds with bullish positions and the average amount invested in these stocks was $83 million. That figure was $30 million in NVGS's case. Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) is the most popular stock in this table. On the other hand Renalytix AI plc (NASDAQ:RNLX) is the least popular one with only 4 bullish hedge fund positions. Navigator Holdings Ltd (NYSE:NVGS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for NVGS is 60.1. 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 positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and beat the market again by 15.8 percentage points. Unfortunately NVGS wasn't nearly as popular as these 20 stocks and hedge funds that were betting on NVGS were disappointed as the stock returned 6.9% since the end of September (through 12/14) 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 this year.

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

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