Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about View, Inc. (NASDAQ:VIEW) in this article.
Is View, Inc. (NASDAQ:VIEW) the right pick for your portfolio? Hedge funds were in an optimistic mood. The number of long hedge fund bets advanced by 22 recently. View, Inc. (NASDAQ:VIEW) was in 22 hedge funds’ portfolios at the end of March. Our calculations also showed that VIEW isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. 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 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Richard Driehaus of Driehaus Capital
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. With all of this in mind let’s check out the new hedge fund action encompassing View, Inc. (NASDAQ:VIEW).
Do Hedge Funds Think VIEW Is A Good Stock To Buy Now?
At first quarter’s end, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of 22 from the previous quarter. On the other hand, there were a total of 0 hedge funds with a bullish position in VIEW a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in View, Inc. (NASDAQ:VIEW) was held by Alyeska Investment Group, which reported holding $15.2 million worth of stock at the end of December. It was followed by Bloom Tree Partners with a $8.9 million position. Other investors bullish on the company included Kamunting Street Capital, Driehaus Capital, and Millennium Management. In terms of the portfolio weights assigned to each position Kamunting Street Capital allocated the biggest weight to View, Inc. (NASDAQ:VIEW), around 3.1% of its 13F portfolio. Bloom Tree Partners is also relatively very bullish on the stock, setting aside 0.73 percent of its 13F equity portfolio to VIEW.
As aggregate interest increased, key hedge funds were breaking ground themselves. Alyeska Investment Group, managed by Anand Parekh, initiated the largest position in View, Inc. (NASDAQ:VIEW). Alyeska Investment Group had $15.2 million invested in the company at the end of the quarter. Alok Agrawal’s Bloom Tree Partners also initiated a $8.9 million position during the quarter. The other funds with brand new VIEW positions are Allan Teh’s Kamunting Street Capital, Richard Driehaus’s Driehaus Capital, and Israel Englander’s Millennium Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as View, Inc. (NASDAQ:VIEW) but similarly valued. These stocks are Montauk Renewables, Inc. (NASDAQ:MNTK), New York Mortgage Trust, Inc. (NASDAQ:NYMT), Eagle Bancorp, Inc. (NASDAQ:EGBN), AssetMark Financial Holdings, Inc. (NYSE:AMK), PRA Group, Inc. (NASDAQ:PRAA), Domo Inc. (NASDAQ:DOMO), and WestAmerica Bancorp. (NASDAQ:WABC). This group of stocks’ market values resemble VIEW’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MNTK | 5 | 6308 | 5 |
| NYMT | 12 | 29071 | -7 |
| EGBN | 13 | 26576 | 3 |
| AMK | 9 | 35936 | -2 |
| PRAA | 15 | 52349 | 2 |
| DOMO | 27 | 273118 | 5 |
| WABC | 13 | 23514 | -1 |
| Average | 13.4 | 63839 | 0.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.4 hedge funds with bullish positions and the average amount invested in these stocks was $64 million. That figure was $66 million in VIEW’s case. Domo Inc. (NASDAQ:DOMO) is the most popular stock in this table. On the other hand Montauk Renewables, Inc. (NASDAQ:MNTK) is the least popular one with only 5 bullish hedge fund positions. View, Inc. (NASDAQ:VIEW) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for VIEW is 71.8. 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 VIEW wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on VIEW were disappointed as the stock returned -4.5% 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 View Inc.
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Disclosure: None. This article was originally published at Insider Monkey.
