In this article we will analyze whether Perella Weinberg Partners (NASDAQ:PWP) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market by double digits annually.
Perella Weinberg Partners (NASDAQ:PWP) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 23 hedge funds’ portfolios at the end of the third quarter of 2021. Our calculations also showed that PWP isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). At the end of this article we will also compare PWP to other stocks including Nexters Inc. (NASDAQ:GDEV), OFG Bancorp (NYSE:OFG), and Kaltura Inc. (NASDAQ:KLTR) to get a better sense of its popularity.
Matthew Lindenbaum of Basswood Capital
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. With all of this in mind we’re going to take a look at the new hedge fund action encompassing Perella Weinberg Partners (NASDAQ:PWP).
Do Hedge Funds Think PWP Is A Good Stock To Buy Now?
At the end of September, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in PWP over the last 25 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
The largest stake in Perella Weinberg Partners (NASDAQ:PWP) was held by Samlyn Capital, which reported holding $41.4 million worth of stock at the end of September. It was followed by Basswood Capital with a $36.8 million position. Other investors bullish on the company included Adage Capital Management, Azora Capital, and Millennium Management. In terms of the portfolio weights assigned to each position Azora Capital allocated the biggest weight to Perella Weinberg Partners (NASDAQ:PWP) , around 2.64% of its 13F portfolio. Basswood Capital is also relatively very bullish on the stock, designating 1.49 percent of its 13F equity portfolio to PWP.
Seeing as Perella Weinberg Partners (NASDAQ:PWP) has witnessed bearish sentiment from the entirety of the hedge funds we track, logic holds that there was a specific group of money managers that decided to sell off their full holdings last quarter. Intriguingly, Anand Parekh’s Alyeska Investment Group dumped the biggest stake of the 750 funds tracked by Insider Monkey, totaling an estimated $7.2 million in stock. Joe DiMenna’s fund, ZWEIG DIMENNA PARTNERS, also dropped its stock, about $1.5 million worth. These transactions are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Perella Weinberg Partners (NASDAQ:PWP) but similarly valued. We will take a look at Nexters Inc. (NASDAQ:GDEV), OFG Bancorp (NYSE:OFG), Kaltura Inc. (NASDAQ:KLTR), Betterware de Mexico, S.A. de C.V. (NASDAQ:BWMX), Marten Transport, Ltd (NASDAQ:MRTN), Sturm, Ruger & Company (NYSE:RGR), and Mission Produce, Inc. (NASDAQ:AVO). This group of stocks’ market values are similar to PWP’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GDEV | 9 | 5232 | 9 |
| OFG | 9 | 48638 | 1 |
| KLTR | 15 | 53855 | 15 |
| BWMX | 6 | 17750 | 1 |
| MRTN | 14 | 32557 | -1 |
| RGR | 16 | 130483 | -3 |
| AVO | 1 | 252 | 0 |
| Average | 10 | 41252 | 3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $41 million. That figure was $208 million in PWP’s case. Sturm, Ruger & Company (NYSE:RGR) is the most popular stock in this table. On the other hand Mission Produce, Inc. (NASDAQ:AVO) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Perella Weinberg Partners (NASDAQ:PWP) is more popular among hedge funds. Our overall hedge fund sentiment score for PWP is 85. 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. Unfortunately PWP wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on PWP were disappointed as the stock returned -4.2% since the end of the third quarter (through 12/9) 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 most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.