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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 866 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. In this article we look at what those investors think of Clearway Energy, Inc. (NYSE:CWEN).
Is Clearway Energy, Inc. (NYSE:CWEN) a bargain? Investors who are in the know were getting more optimistic. The number of long hedge fund positions inched up by 2 recently. Clearway Energy, Inc. (NYSE:CWEN) was in 24 hedge funds' portfolios at the end of March. The all time high for this statistic is 27. Our calculations also showed that CWEN 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.
Charles Davidson of Wexford Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Chuck Schumer recently stated that marijuana legalization will be a Senate priority. So, we are checking out this under the radar stock that will benefit from this. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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. Now let's go over the key hedge fund action regarding Clearway Energy, Inc. (NYSE:CWEN).
Do Hedge Funds Think CWEN Is A Good Stock To Buy Now?
At first quarter's end, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, a change of 9% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CWEN over the last 23 quarters. With hedge funds' sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
The largest stake in Clearway Energy, Inc. (NYSE:CWEN) was held by Renaissance Technologies, which reported holding $53.6 million worth of stock at the end of December. It was followed by Renaissance Technologies with a $39 million position. Other investors bullish on the company included Southpoint Capital Advisors, Electron Capital Partners, and Millennium Management. In terms of the portfolio weights assigned to each position Mountaineer Partners Management allocated the biggest weight to Clearway Energy, Inc. (NYSE:CWEN), around 5.52% of its 13F portfolio. Alta Fundamental Advisers is also relatively very bullish on the stock, designating 5.21 percent of its 13F equity portfolio to CWEN.
Now, some big names were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, initiated the largest position in Clearway Energy, Inc. (NYSE:CWEN). Marshall Wace LLP had $4.5 million invested in the company at the end of the quarter. Greg Poole's Echo Street Capital Management also made a $2.7 million investment in the stock during the quarter. The other funds with brand new CWEN positions are Michael Gelband's ExodusPoint Capital, Paul Tudor Jones's Tudor Investment Corp, and Charles Davidson and Joseph Jacobs's Wexford Capital.
Let's also examine hedge fund activity in other stocks similar to Clearway Energy, Inc. (NYSE:CWEN). We will take a look at Karuna Therapeutics, Inc. (NASDAQ:KRTX), Jumia Technologies AG (NYSE:JMIA), Sendas Distribuidora S.A. (NYSE:ASAI), Celsius Holdings, Inc. (NASDAQ:CELH), I-Mab (NASDAQ:IMAB), 8x8, Inc. (NYSE:EGHT), and Vishay Intertechnology, Inc. (NYSE:VSH). This group of stocks' market caps are similar to CWEN's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position KRTX,23,396412,6 JMIA,16,123790,3 ASAI,6,11657,6 CELH,15,116405,-4 IMAB,20,509159,6 EGHT,24,1006511,-2 VSH,32,565142,1 Average,19.4,389868,2.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.4 hedge funds with bullish positions and the average amount invested in these stocks was $390 million. That figure was $232 million in CWEN's case. Vishay Intertechnology, Inc. (NYSE:VSH) is the most popular stock in this table. On the other hand Sendas Distribuidora S.A. (NYSE:ASAI) is the least popular one with only 6 bullish hedge fund positions. Clearway Energy, Inc. (NYSE:CWEN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CWEN is 68.3. 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. 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 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 23.8% in 2021 through July 16th and beat the market again by 7.7 percentage points. Unfortunately CWEN wasn't nearly as popular as these 5 stocks and hedge funds that were betting on CWEN were disappointed as the stock returned -5.8% since the end of March (through 7/16) 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 many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.