Hedge Funds Are Crazy About Everi Holdings Inc (EVRI)

Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Everi Holdings Inc (NYSE:EVRI).

Everi Holdings Inc (NYSE:EVRI) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 31 hedge funds’ portfolios at the end of the third quarter of 2021. Our calculations also showed that EVRI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Hello Group Inc. (NASDAQ:MOMO), Cimpress plc (NASDAQ:CMPR), and Cavco Industries, Inc. (NASDAQ:CVCO) to gather more data points.

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. Keeping this in mind let’s take a look at the key hedge fund action surrounding Everi Holdings Inc (NYSE:EVRI).

Richard Driehaus of Driehaus Capital

Do Hedge Funds Think EVRI Is A Good Stock To Buy Now?

At third quarter’s end, a total of 31 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards EVRI over the last 25 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).

Among these funds, Driehaus Capital held the most valuable stake in Everi Holdings Inc (NYSE:EVRI), which was worth $46.7 million at the end of the third quarter. On the second spot was Cowbird Capital which amassed $29.8 million worth of shares. Two Sigma Advisors, Private Capital Management, and DG Capital 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 Cowbird Capital allocated the biggest weight to Everi Holdings Inc (NYSE:EVRI), around 10.22% of its 13F portfolio. DG Capital Management is also relatively very bullish on the stock, dishing out 5.02 percent of its 13F equity portfolio to EVRI.

Due to the fact that Everi Holdings Inc (NYSE:EVRI) has faced falling interest from the aggregate hedge fund industry, it’s easy to see that there was a specific group of fund managers that slashed their positions entirely by the end of the third quarter. Intriguingly, Jeffrey Jacobowitz’s Simcoe Capital Management dropped the largest investment of the 750 funds monitored by Insider Monkey, worth about $22.2 million in call options. Seth Wunder’s fund, Black-and-White Capital, also cut its call options, about $9.5 million worth. These transactions are intriguing to say the least, 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 similar to Everi Holdings Inc (NYSE:EVRI). These stocks are Hello Group Inc. (NASDAQ:MOMO), Cimpress plc (NASDAQ:CMPR), Cavco Industries, Inc. (NASDAQ:CVCO), First Midwest Bancorp Inc (NASDAQ:FMBI), C4 Therapeutics, Inc. (NASDAQ:CCCC), Nuvation Bio Inc. (NYSE:NUVB), and Sandy Spring Bancorp Inc. (NASDAQ:SASR). All of these stocks’ market caps match EVRI’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 17.4 hedge funds with bullish positions and the average amount invested in these stocks was $245 million. That figure was $301 million in EVRI’s case. Nuvation Bio Inc. (NYSE:NUVB) is the most popular stock in this table. On the other hand Sandy Spring Bancorp Inc. (NASDAQ:SASR) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Everi Holdings Inc (NYSE:EVRI) is more popular among hedge funds. Our overall hedge fund sentiment score for EVRI 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Unfortunately EVRI wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on EVRI were disappointed as the stock returned -14.2% since the end of the third quarter (through 11/30) 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.