We at Insider Monkey have gone over 867 13F filings that hedge funds and prominent investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. In this article, we look at what those funds think of Roblox Corporation (NYSE:RBLX) based on that data.
Roblox Corporation (NYSE:RBLX) investors should pay attention to an increase in hedge fund sentiment in recent months. Roblox Corporation (NYSE:RBLX) was in 50 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 49. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 49 hedge funds in our database with RBLX holdings at the end of June. Our calculations also showed that RBLX isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
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. With all of this in mind let’s take a peek at the recent hedge fund action regarding Roblox Corporation (NYSE:RBLX).
Alex Sacerdote of Whale Rock Capital Management
Do Hedge Funds Think RBLX Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 50 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 2% from the previous quarter. On the other hand, there were a total of 0 hedge funds with a bullish position in RBLX a year ago. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
Among these funds, Tiger Global Management LLC held the most valuable stake in Roblox Corporation (NYSE:RBLX), which was worth $1316.9 million at the end of the third quarter. On the second spot was Coatue Management which amassed $552.7 million worth of shares. 12 West Capital Management, Altimeter Capital Management, and Whale Rock 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 12 West Capital Management allocated the biggest weight to Roblox Corporation (NYSE:RBLX), around 12.79% of its 13F portfolio. Himension Capital is also relatively very bullish on the stock, earmarking 11.3 percent of its 13F equity portfolio to RBLX.
As one would reasonably expect, key money managers have jumped into Roblox Corporation (NYSE:RBLX) headfirst. HMI Capital, managed by Mick Hellman, established the biggest position in Roblox Corporation (NYSE:RBLX). HMI Capital had $144.9 million invested in the company at the end of the quarter. Gil Simon’s SoMa Equity Partners also made a $33.3 million investment in the stock during the quarter. The other funds with new positions in the stock are David Costen Haley’s HBK Investments, Jeffrey Hoffner’s Engle Capital, and Edward Goodnow’s Goodnow Investment Group.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Roblox Corporation (NYSE:RBLX) but similarly valued. These stocks are Ambev SA (NYSE:ABEV), Southern Copper Corporation (NYSE:SCCO), Canadian Pacific Railway Limited (NYSE:CP), Newmont Corporation (NYSE:NEM), Canadian Natural Resources Limited (NYSE:CNQ), National Grid plc (NYSE:NGG), and Spotify Technology S.A. (NYSE:SPOT). This group of stocks’ market values resemble RBLX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ABEV | 15 | 79897 | -3 |
| SCCO | 23 | 403491 | 0 |
| CP | 38 | 6638996 | 13 |
| NEM | 48 | 774451 | -7 |
| CNQ | 27 | 956988 | 0 |
| NGG | 5 | 314057 | -2 |
| SPOT | 48 | 3038733 | 0 |
| Average | 29.1 | 1743802 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.1 hedge funds with bullish positions and the average amount invested in these stocks was $1744 million. That figure was $3576 million in RBLX’s case. Newmont Corporation (NYSE:NEM) is the most popular stock in this table. On the other hand National Grid plc (NYSE:NGG) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Roblox Corporation (NYSE:RBLX) is more popular among hedge funds. Our overall hedge fund sentiment score for RBLX is 86. 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 returned 28.6% in 2021 through November 30th but still managed to beat the market by 5.6 percentage points. Hedge funds were also right about betting on RBLX as the stock returned 66.9% since the end of September (through 11/30) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
