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 867 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 September 30th. Hedge funds’ consensus stock picks performed spectacularly over the last 3 years, but 2022 hasn’t been kind to hedge funds. In this article we look at how hedge funds traded Intuit Inc. (NASDAQ:INTU) and determine whether the smart money was really smart about this stock.
Intuit Inc. (NASDAQ:INTU) was in 64 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 68. INTU shareholders have witnessed a decrease in activity from the world’s largest hedge funds in recent months. There were 66 hedge funds in our database with INTU positions at the end of the second quarter. Our calculations also showed that INTU isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV 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. Keeping this in mind let’s go over the latest hedge fund action surrounding Intuit Inc. (NASDAQ:INTU).
Dmitry Balyasny of Balyasny Asset Management
Do Hedge Funds Think INTU Is A Good Stock To Buy Now?
At the end of September, a total of 64 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -3% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in INTU over the last 25 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Intuit Inc. (NASDAQ:INTU) was held by Fundsmith LLP, which reported holding $2472.3 million worth of stock at the end of September. It was followed by Third Point with a $593.5 million position. Other investors bullish on the company included Arrowstreet Capital, Foxhaven Asset Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Foxhaven Asset Management allocated the biggest weight to Intuit Inc. (NASDAQ:INTU), around 7.38% of its 13F portfolio. Blue Whale Capital is also relatively very bullish on the stock, setting aside 6.91 percent of its 13F equity portfolio to INTU.
Judging by the fact that Intuit Inc. (NASDAQ:INTU) has experienced bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there is a sect of money managers that elected to cut their entire stakes by the end of the third quarter. At the top of the heap, Zach Schreiber’s Point State Capital dropped the biggest investment of the “upper crust” of funds monitored by Insider Monkey, comprising close to $31.9 million in stock. Guy Shahar’s fund, DSAM Partners, also said goodbye to its stock, about $21.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds by the end of the third quarter.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Intuit Inc. (NASDAQ:INTU) but similarly valued. These stocks are Honeywell International Inc. (NASDAQ:HON), QUALCOMM, Incorporated (NASDAQ:QCOM), Citigroup Inc. (NYSE:C), Royal Bank of Canada (NYSE:RY), Lowe’s Companies, Inc. (NYSE:LOW), Unilever PLC (NYSE:UL), and The Charles Schwab Corporation (NYSE:SCHW). This group of stocks’ market values are closest to INTU’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HON | 45 | 927738 | -12 |
| QCOM | 70 | 3519652 | -2 |
| C | 79 | 5587345 | -8 |
| RY | 16 | 1103417 | -2 |
| LOW | 60 | 5080325 | -3 |
| UL | 17 | 876681 | -2 |
| SCHW | 59 | 4578571 | -13 |
| Average | 49.4 | 3096247 | -6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 49.4 hedge funds with bullish positions and the average amount invested in these stocks was $3096 million. That figure was $6152 million in INTU’s case. Citigroup Inc. (NYSE:C) is the most popular stock in this table. On the other hand Royal Bank of Canada (NYSE:RY) is the least popular one with only 16 bullish hedge fund positions. Intuit Inc. (NASDAQ:INTU) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for INTU is 69.3. 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 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 29.6% in 2021 and still managed to beat the market by another 3.6 percentage points. Hedge funds were somewhat right about betting on INTU as the stock returned 3.2% since the end of September (through January 31st) and outperformed the top 5 hedge fund stocks but not the market. This is a rare phenomenon as top hedge fund stocks usually beat the market over the long-term.
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Disclosure: None. This article was originally published at Insider Monkey.
