Were Hedge Funds Right About Dell Technologies (DELL)?
A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Dell Technologies Inc. (NYSE:DELL).
Dell Technologies Inc. (NYSE:DELL) has experienced an increase in hedge fund sentiment of late. Dell Technologies Inc. (NYSE:DELL) was in 50 hedge funds' portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 86. There were 43 hedge funds in our database with DELL holdings at the end of September. Our calculations also showed that DELL isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).
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Joshua Friedman of Canyon Capital Advisors
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Do Hedge Funds Think DELL Is A Good Stock To Buy Now?
At fourth quarter's end, a total of 50 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 16% from the previous quarter. On the other hand, there were a total of 41 hedge funds with a bullish position in DELL 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.
More specifically, Elliott Investment Management was the largest shareholder of Dell Technologies Inc. (NYSE:DELL), with a stake worth $1820 million reported as of the end of December. Trailing Elliott Investment Management was Canyon Capital Advisors, which amassed a stake valued at $456.2 million. Lyrical Asset Management, Point72 Asset Management, and First Pacific Advisors LLC were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position HighVista Strategies allocated the biggest weight to Dell Technologies Inc. (NYSE:DELL), around 31.86% of its 13F portfolio. Canyon Capital Advisors is also relatively very bullish on the stock, dishing out 19.69 percent of its 13F equity portfolio to DELL.
As aggregate interest increased, key money managers have been driving this bullishness. Impax Asset Management, managed by Ian Simm, initiated the biggest position in Dell Technologies Inc. (NYSE:DELL). Impax Asset Management had $20.1 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also initiated a $13.8 million position during the quarter. The other funds with new positions in the stock are Matthew Hulsizer's PEAK6 Capital Management, Paul Marshall and Ian Wace's Marshall Wace LLP, and Ryan Tolkin (CIO)'s Schonfeld Strategic Advisors.
Let's now review hedge fund activity in other stocks similar to Dell Technologies Inc. (NYSE:DELL). We will take a look at Analog Devices, Inc. (NASDAQ:ADI), Equinor ASA (NYSE:EQNR), Moody's Corporation (NYSE:MCO), Twilio Inc. (NYSE:TWLO), Humana Inc (NYSE:HUM), Illumina, Inc. (NASDAQ:ILMN), and Westpac Banking Corporation (NYSE:WBK). This group of stocks' market caps match DELL's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ADI,58,5319785,6 EQNR,18,238582,-2 MCO,59,11352402,-1 TWLO,94,5011455,23 HUM,59,3966420,-2 ILMN,45,1747647,1 WBK,3,29715,-1 Average,48,3952287,3.4 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 48 hedge funds with bullish positions and the average amount invested in these stocks was $3952 million. That figure was $3909 million in DELL's case. Twilio Inc. (NYSE:TWLO) is the most popular stock in this table. On the other hand Westpac Banking Corporation (NYSE:WBK) is the least popular one with only 3 bullish hedge fund positions. Dell Technologies Inc. (NYSE:DELL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for DELL is 53.3. 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. Our calculations showed that top 10 most popular stocks among hedge funds returned 90.7% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 35 percentage points. These stocks gained 13.6% in 2021 through April 30th and still beat the market by 1.6 percentage points. Hedge funds were also right about betting on DELL as the stock returned 34.2% since the end of Q4 (through 4/30) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
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