After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of June 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Enterprise Products Partners L.P. (NYSE:EPD).
Is Enterprise Products Partners L.P. (NYSE:EPD) worth your attention right now? The best stock pickers were in an optimistic mood. The number of long hedge fund bets went up by 2 in recent months. Enterprise Products Partners L.P. (NYSE:EPD) was in 28 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 30. Our calculations also showed that EPD isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 26 hedge funds in our database with EPD positions at the end of the first quarter.
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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 view the new hedge fund action surrounding Enterprise Products Partners L.P. (NYSE:EPD).
Do Hedge Funds Think EPD Is A Good Stock To Buy Now?
At second quarter’s end, a total of 28 of the hedge funds tracked by Insider Monkey were long this stock, a change of 8% from the previous quarter. The graph below displays the number of hedge funds with bullish position in EPD over the last 24 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Stuart J. Zimmer’s Zimmer Partners has the largest position in Enterprise Products Partners L.P. (NYSE:EPD), worth close to $59.8 million, accounting for 0.8% of its total 13F portfolio. Sitting at the No. 2 spot is David Tepper of Appaloosa Management LP, with a $49.8 million position; the fund has 1% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions contain Ken Griffin’s Citadel Investment Group, Allan Teh’s Kamunting Street Capital and Henry Breck’s Heronetta Management. In terms of the portfolio weights assigned to each position Heronetta Management allocated the biggest weight to Enterprise Products Partners L.P. (NYSE:EPD), around 13.25% of its 13F portfolio. Kamunting Street Capital is also relatively very bullish on the stock, designating 9.43 percent of its 13F equity portfolio to EPD.
As industrywide interest jumped, key hedge funds were breaking ground themselves. Amitell Capital, managed by Peter Galgay, initiated the largest position in Enterprise Products Partners L.P. (NYSE:EPD). Amitell Capital had $4.5 million invested in the company at the end of the quarter. Bruce Berkowitz’s Fairholme (FAIRX) also initiated a $1.8 million position during the quarter. The other funds with new positions in the stock are James Dondero’s Highland Capital Management and Casey Whalen’s Truvvo Partners.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Enterprise Products Partners L.P. (NYSE:EPD) but similarly valued. We will take a look at Spotify Technology S.A. (NYSE:SPOT), Public Storage (NYSE:PSA), Metlife Inc (NYSE:MET), Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), Biogen Inc. (NASDAQ:BIIB), Carvana Co. (NYSE:CVNA), and ING Groep N.V. (NYSE:ING). All of these stocks’ market caps are similar to EPD’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SPOT | 48 | 3496814 | 2 |
| PSA | 27 | 1089757 | 1 |
| MET | 41 | 1056766 | 9 |
| VRTX | 60 | 2808847 | -8 |
| BIIB | 67 | 3116691 | 4 |
| CVNA | 63 | 8904829 | -1 |
| ING | 9 | 601603 | -1 |
| Average | 45 | 3010758 | 0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 45 hedge funds with bullish positions and the average amount invested in these stocks was $3011 million. That figure was $246 million in EPD’s case. Biogen Inc. (NASDAQ:BIIB) is the most popular stock in this table. On the other hand ING Groep N.V. (NYSE:ING) is the least popular one with only 9 bullish hedge fund positions. Enterprise Products Partners L.P. (NYSE:EPD) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for EPD is 51.4. 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 24.9% in 2021 through October 15th and still beat the market by 4.5 percentage points. A small number of hedge funds were also right about betting on EPD as the stock returned 2.5% since the end of the second quarter (through 10/15) and outperformed the market by an even larger margin.
Follow Enterprise Products Partners L.p. (NYSE:EPD)
Follow Enterprise Products Partners L.p. (NYSE:EPD)
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Disclosure: None. This article was originally published at Insider Monkey.
