Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is EverQuote, Inc. (NASDAQ:EVER), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is EverQuote, Inc. (NASDAQ:EVER) a buy here? Hedge funds were becoming more confident. The number of bullish hedge fund bets went up by 1 recently. EverQuote, Inc. (NASDAQ:EVER) was in 19 hedge funds’ portfolios at the end of March. The all time high for this statistic is 23. Our calculations also showed that EVER isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 18 hedge funds in our database with EVER positions at the end of the fourth quarter.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
David Siegel of Two Sigma Advisors
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. Keeping this in mind let’s review the key hedge fund action surrounding EverQuote, Inc. (NASDAQ:EVER).
Do Hedge Funds Think EVER Is A Good Stock To Buy Now?
At first quarter’s end, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards EVER over the last 23 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Shannon River Fund Management, managed by Spencer M. Waxman, holds the biggest position in EverQuote, Inc. (NASDAQ:EVER). Shannon River Fund Management has a $29.8 million position in the stock, comprising 2% of its 13F portfolio. Coming in second is Renaissance Technologies, with a $24 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other professional money managers that are bullish consist of Josh Goldberg’s G2 Investment Partners Management, Joseph Samuels’s Islet Management and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position P.A.W. CAPITAL PARTNERS allocated the biggest weight to EverQuote, Inc. (NASDAQ:EVER), around 5.27% of its 13F portfolio. G2 Investment Partners Management is also relatively very bullish on the stock, designating 3.72 percent of its 13F equity portfolio to EVER.
With a general bullishness amongst the heavyweights, key money managers have been driving this bullishness. AlphaCrest Capital Management, managed by Mika Toikka, established the largest position in EverQuote, Inc. (NASDAQ:EVER). AlphaCrest Capital Management had $0.6 million invested in the company at the end of the quarter. Matthew Hulsizer’s PEAK6 Capital Management also made a $0.5 million investment in the stock during the quarter. The following funds were also among the new EVER investors: Michael Gelband’s ExodusPoint Capital, Dmitry Balyasny’s Balyasny Asset Management, and Parvinder Thiara’s Athanor Capital.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as EverQuote, Inc. (NASDAQ:EVER) but similarly valued. We will take a look at Veeco Instruments Inc. (NASDAQ:VECO), SFL Corporation Ltd. (NYSE:SFL), Humanigen, Inc. (NASDAQ:HGEN), Eos Energy Enterprises, Inc. (NASDAQ:EOSE), Accel Entertainment, Inc. (NYSE:ACEL), PetIQ, Inc. (NASDAQ:PETQ), and Inseego Corp. (NASDAQ:INSG). All of these stocks’ market caps are similar to EVER’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| VECO | 20 | 381940 | 1 |
| SFL | 14 | 25172 | 0 |
| HGEN | 11 | 220502 | 6 |
| EOSE | 11 | 24885 | 1 |
| ACEL | 12 | 177573 | -2 |
| PETQ | 10 | 92659 | 1 |
| INSG | 8 | 21928 | -8 |
| Average | 12.3 | 134951 | -0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.3 hedge funds with bullish positions and the average amount invested in these stocks was $135 million. That figure was $135 million in EVER’s case. Veeco Instruments Inc. (NASDAQ:VECO) is the most popular stock in this table. On the other hand Inseego Corp. (NASDAQ:INSG) is the least popular one with only 8 bullish hedge fund positions. EverQuote, Inc. (NASDAQ:EVER) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for EVER is 76.6. 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 EVER wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on EVER were disappointed as the stock returned -19.4% 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.
Follow Everquote Inc. (NASDAQ:EVER)
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Disclosure: None. This article was originally published at Insider Monkey.
