Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Ventas, Inc. (NYSE:VTR).
Ventas, Inc. (NYSE:VTR) has experienced a decrease in support from the world’s most elite money managers lately. Ventas, Inc. (NYSE:VTR) was in 23 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 29. There were 25 hedge funds in our database with VTR holdings at the end of June. Our calculations also showed that VTR 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. Now let’s view the new hedge fund action regarding Ventas, Inc. (NYSE:VTR).
Do Hedge Funds Think VTR Is A Good Stock To Buy Now?
At Q3’s end, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of -8% from one quarter earlier. On the other hand, there were a total of 17 hedge funds with a bullish position in VTR a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Zimmer Partners held the most valuable stake in Ventas, Inc. (NYSE:VTR), which was worth $203.6 million at the end of the third quarter. On the second spot was Healthcor Management LP which amassed $40 million worth of shares. Citadel Investment Group, Land & Buildings Investment Management, and Millennium Management 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 Land & Buildings Investment Management allocated the biggest weight to Ventas, Inc. (NYSE:VTR), around 5.52% of its 13F portfolio. Zimmer Partners is also relatively very bullish on the stock, designating 3.2 percent of its 13F equity portfolio to VTR.
Because Ventas, Inc. (NYSE:VTR) has witnessed declining sentiment from the aggregate hedge fund industry, it’s easy to see that there lies a certain “tier” of funds that slashed their entire stakes in the third quarter. Intriguingly, Charles Clough’s Clough Capital Partners dropped the largest stake of the “upper crust” of funds tracked by Insider Monkey, worth about $26.4 million in stock. Paul Marshall and Ian Wace’s fund, Marshall Wace LLP, also sold off its stock, about $8.8 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds in the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Ventas, Inc. (NYSE:VTR) but similarly valued. These stocks are McCormick & Company, Incorporated (NYSE:MKC), DTE Energy Company (NYSE:DTE), FleetCor Technologies, Inc. (NYSE:FLT), Dollar Tree, Inc. (NASDAQ:DLTR), TransUnion (NYSE:TRU), Mid America Apartment Communities Inc (NYSE:MAA), and PPL Corporation (NYSE:PPL). This group of stocks’ market valuations match VTR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MKC | 35 | 1782097 | 1 |
| DTE | 22 | 426119 | -10 |
| FLT | 31 | 2095712 | -9 |
| DLTR | 38 | 1215394 | -4 |
| TRU | 38 | 2180644 | 3 |
| MAA | 22 | 254912 | 8 |
| PPL | 20 | 140767 | -3 |
| Average | 29.4 | 1156521 | -2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.4 hedge funds with bullish positions and the average amount invested in these stocks was $1157 million. That figure was $465 million in VTR’s case. Dollar Tree, Inc. (NASDAQ:DLTR) is the most popular stock in this table. On the other hand PPL Corporation (NYSE:PPL) is the least popular one with only 20 bullish hedge fund positions. Ventas, Inc. (NYSE:VTR) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for VTR is 35.1. 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 negative signal and 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 31.1% in 2021 through December 9th and surpassed the market again by 5.1 percentage points. Unfortunately VTR wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); VTR investors were disappointed as the stock returned -9.9% since the end of September (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 in 2021.
Follow Ventas Inc. (NYSE:VTR)
Follow Ventas Inc. (NYSE:VTR)
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Disclosure: None. This article was originally published at Insider Monkey.
