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. Insider Monkey finished processing 866 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. What do these smart investors think about Enable Midstream Partners LP (NYSE:ENBL)?
Is Enable Midstream Partners LP (NYSE:ENBL) a healthy stock for your portfolio? Investors who are in the know were getting more bullish. The number of bullish hedge fund positions moved up by 3 recently. Enable Midstream Partners LP (NYSE:ENBL) was in 6 hedge funds’ portfolios at the end of March. The all time high for this statistic is 9. Our calculations also showed that ENBL isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 3 hedge funds in our database with ENBL holdings at the end of December.
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.
Matthew Halbower of Pentwater Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund owns nearly 40% of this $24 biotech stock and is trying to buy the rest for around $50. So, we recommended a long position to our monthly premium newsletter subscribers. 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 we’re going to analyze the latest hedge fund action surrounding Enable Midstream Partners LP (NYSE:ENBL).
Do Hedge Funds Think ENBL Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of 100% from the fourth quarter of 2020. The graph below displays the number of hedge funds with bullish position in ENBL over the last 23 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, John Orrico’s Water Island Capital has the largest position in Enable Midstream Partners LP (NYSE:ENBL), worth close to $12.6 million, accounting for 0.8% of its total 13F portfolio. Coming in second is Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, which holds a $11.9 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other peers that hold long positions contain Matthew Halbower’s Pentwater Capital Management, Emanuel J. Friedman’s EJF Capital and John Murphy’s Levin Easterly Partners. In terms of the portfolio weights assigned to each position Water Island Capital allocated the biggest weight to Enable Midstream Partners LP (NYSE:ENBL), around 0.77% of its 13F portfolio. Pentwater Capital Management is also relatively very bullish on the stock, setting aside 0.02 percent of its 13F equity portfolio to ENBL.
Now, some big names have been driving this bullishness. Water Island Capital, managed by John Orrico, initiated the most valuable position in Enable Midstream Partners LP (NYSE:ENBL). Water Island Capital had $12.6 million invested in the company at the end of the quarter. Matthew Halbower’s Pentwater Capital Management also made a $2.3 million investment in the stock during the quarter. The other funds with brand new ENBL positions are John Murphy’s Levin Easterly Partners and Ken Griffin’s Citadel Investment Group.
Let’s now take a look at hedge fund activity in other stocks similar to Enable Midstream Partners LP (NYSE:ENBL). These stocks are Taro Pharmaceutical Industries Ltd. (NYSE:TARO), Cedar Fair, L.P. (NYSE:FUN), Burning Rock Biotech Limited (NASDAQ:BNR), Graham Holdings Co (NYSE:GHC), Hilltop Holdings Inc. (NYSE:HTH), Methanex Corporation (NASDAQ:MEOH), and Micro Focus Intl PLC (NYSE:MFGP). This group of stocks’ market caps match ENBL’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TARO | 8 | 81146 | 2 |
| FUN | 14 | 157490 | 0 |
| BNR | 11 | 104426 | -1 |
| GHC | 23 | 550549 | -2 |
| HTH | 16 | 63331 | -4 |
| MEOH | 16 | 61332 | 4 |
| MFGP | 7 | 39325 | -3 |
| Average | 13.6 | 151086 | -0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.6 hedge funds with bullish positions and the average amount invested in these stocks was $151 million. That figure was $27 million in ENBL’s case. Graham Holdings Co (NYSE:GHC) is the most popular stock in this table. On the other hand Micro Focus Intl PLC (NYSE:MFGP) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Enable Midstream Partners LP (NYSE:ENBL) is even less popular than MFGP. Our overall hedge fund sentiment score for ENBL is 28. 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. Hedge funds clearly dropped the ball on ENBL as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. 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 19.3% in 2021 through June 25th and still beat the market by 4.8 percentage points. A small number of hedge funds were also right about betting on ENBL as the stock returned 44.7% since Q1 (through June 25th) and outperformed the market by an even larger margin.
Follow Enable Midstream Partners Lp (NYSE:ENBL)
Follow Enable Midstream Partners Lp (NYSE:ENBL)
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Disclosure: None. This article was originally published at Insider Monkey.
