In this article we will check out the progression of hedge fund sentiment towards Globant SA (NYSE:GLOB) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
Globant SA (NYSE:GLOB) has experienced an increase in hedge fund sentiment lately. Globant SA (NYSE:GLOB) was in 23 hedge funds’ portfolios at the end of June. The all time high for this statistic was previously 21. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 17 hedge funds in our database with GLOB positions at the end of the first quarter. Our calculations also showed that GLOB isn’t among the 30 most popular stocks among hedge funds (click for Q2 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. 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.
Crispin Odey of Odey Asset Management Group
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Do Hedge Funds Think GLOB Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 35% from one quarter earlier. By comparison, 17 hedge funds held shares or bullish call options in GLOB a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Fisher Asset Management was the largest shareholder of Globant SA (NYSE:GLOB), with a stake worth $231.7 million reported as of the end of June. Trailing Fisher Asset Management was Cartica Management, which amassed a stake valued at $43.7 million. Millennium Management, Marshall Wace LLP, and Driehaus Capital 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 Cartica Management allocated the biggest weight to Globant SA (NYSE:GLOB), around 8.38% of its 13F portfolio. Odey Asset Management Group is also relatively very bullish on the stock, designating 0.59 percent of its 13F equity portfolio to GLOB.
As aggregate interest increased, key money managers have jumped into Globant SA (NYSE:GLOB) headfirst. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, initiated the largest position in Globant SA (NYSE:GLOB). Marshall Wace LLP had $38.2 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also initiated a $20.3 million position during the quarter. The other funds with new positions in the stock are D. E. Shaw’s D E Shaw, Crispin Odey’s Odey Asset Management Group, and Michael Gelband’s ExodusPoint Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Globant SA (NYSE:GLOB) but similarly valued. These stocks are Service Corporation International (NYSE:SCI), Phillips 66 Partners LP (NYSE:PSXP), Sealed Air Corporation (NYSE:SEE), Bright Horizons Family Solutions Inc (NYSE:BFAM), Juniper Networks, Inc. (NYSE:JNPR), ADT Inc. (NYSE:ADT), and Dicks Sporting Goods Inc (NYSE:DKS). This group of stocks’ market valuations are closest to GLOB’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SCI | 24 | 527197 | 1 |
| PSXP | 5 | 36056 | 0 |
| SEE | 28 | 705369 | 1 |
| BFAM | 17 | 107496 | -1 |
| JNPR | 27 | 355046 | -2 |
| ADT | 21 | 417800 | 5 |
| DKS | 36 | 1414349 | 5 |
| Average | 22.6 | 509045 | 1.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 22.6 hedge funds with bullish positions and the average amount invested in these stocks was $509 million. That figure was $447 million in GLOB’s case. Dicks Sporting Goods Inc (NYSE:DKS) is the most popular stock in this table. On the other hand Phillips 66 Partners LP (NYSE:PSXP) is the least popular one with only 5 bullish hedge fund positions. Globant SA (NYSE:GLOB) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GLOB is 69. 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 October 22nd and still beat the market by 1.6 percentage points. Hedge funds were also right about betting on GLOB as the stock returned 39.2% since the end of Q2 (through 10/22) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Globant S.a. (NYSE:GLOB)
Follow Globant S.a. (NYSE:GLOB)
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Disclosure: None. This article was originally published at Insider Monkey.
