Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Progyny, Inc. (NASDAQ:PGNY), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Progyny, Inc. (NASDAQ:PGNY) investors should pay attention to an increase in activity from the world’s largest hedge funds of late. Progyny, Inc. (NASDAQ:PGNY) was in 26 hedge funds’ portfolios at the end of March. The all time high for this statistic is 24. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 24 hedge funds in our database with PGNY holdings at the end of December. Our calculations also showed that PGNY 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.
Gavin Saitowitz of Prelude Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, economists warn of inflation flare up. So, we are checking out this backdoor gold play that has hit peak gains of 718% in a little over a year. 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 key hedge fund action regarding Progyny, Inc. (NASDAQ:PGNY).
Do Hedge Funds Think PGNY Is A Good Stock To Buy Now?
At first quarter’s end, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 8% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards PGNY over the last 23 quarters. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
Among these funds, OrbiMed Advisors held the most valuable stake in Progyny, Inc. (NASDAQ:PGNY), which was worth $85.7 million at the end of the fourth quarter. On the second spot was Citadel Investment Group which amassed $26.5 million worth of shares. Owls Nest Partners, General Equity Partners, 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 Owls Nest Partners allocated the biggest weight to Progyny, Inc. (NASDAQ:PGNY), around 12.44% of its 13F portfolio. General Equity Partners is also relatively very bullish on the stock, designating 8.91 percent of its 13F equity portfolio to PGNY.
As industrywide interest jumped, key money managers have been driving this bullishness. Engineers Gate Manager, managed by Greg Eisner, created the most valuable position in Progyny, Inc. (NASDAQ:PGNY). Engineers Gate Manager had $0.7 million invested in the company at the end of the quarter. Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital) also made a $0.5 million investment in the stock during the quarter. The other funds with new positions in the stock are Brian Ashford-Russell and Tim Woolley’s Polar Capital, Jinghua Yan’s TwinBeech Capital, and Cliff Asness’s AQR Capital Management.
Let’s go over hedge fund activity in other stocks similar to Progyny, Inc. (NASDAQ:PGNY). We will take a look at New Relic Inc (NYSE:NEWR), EnerSys (NYSE:ENS), Umpqua Holdings Corp (NASDAQ:UMPQ), Brighthouse Financial, Inc. (NASDAQ:BHF), Glaukos Corporation (NYSE:GKOS), Spire Inc. (NYSE:SR), and New Jersey Resources Corp (NYSE:NJR). This group of stocks’ market caps are closest to PGNY’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NEWR | 27 | 1141779 | -3 |
| ENS | 28 | 119582 | 4 |
| UMPQ | 25 | 245140 | 2 |
| BHF | 28 | 539727 | -5 |
| GKOS | 18 | 47095 | 5 |
| SR | 9 | 20905 | -6 |
| NJR | 12 | 26762 | -1 |
| Average | 21 | 305856 | -0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $306 million. That figure was $221 million in PGNY’s case. EnerSys (NYSE:ENS) is the most popular stock in this table. On the other hand Spire Inc. (NYSE:SR) is the least popular one with only 9 bullish hedge fund positions. Progyny, Inc. (NASDAQ:PGNY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for PGNY is 81.7. 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% in 2021 through July 9th and still beat the market by 6.7 percentage points. Hedge funds were also right about betting on PGNY as the stock returned 32.2% since the end of Q1 (through 7/9) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
