The latest 13F reporting period has come and gone, and Insider Monkey have plowed through 823 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of June 30th, when the S&P 500 Index was trading around the 3100 level. Since the end of March, investors decided to bet on the economic recovery and a stock market rebound. S&P 500 Index returned more than 50% since its bottom. In this article you are going to find out whether hedge funds thought Repay Holdings Corporation (NASDAQ:RPAY) was a good investment heading into the third quarter and how the stock traded in comparison to the top hedge fund picks.
Repay Holdings Corporation (NASDAQ:RPAY) shareholders have witnessed an increase in activity from the world’s largest hedge funds recently. Repay Holdings Corporation (NASDAQ:RPAY) was in 18 hedge funds’ portfolios at the end of the second quarter of 2020. The all time high for this statistics is 12. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that RPAY isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In today’s marketplace there are many gauges shareholders can use to appraise stocks. A duo of the most underrated gauges are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the top picks of the top investment managers can trounce the market by a healthy amount (see the details here).
Richard Driehaus of Driehaus Capital
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we are checking out this junior gold mining stock and we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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 website to get excerpts of these letters in your inbox. With all of this in mind let’s view the fresh hedge fund action regarding Repay Holdings Corporation (NASDAQ:RPAY).
How have hedgies been trading Repay Holdings Corporation (NASDAQ:RPAY)?
At Q2’s end, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 125% from the first quarter of 2020. On the other hand, there were a total of 12 hedge funds with a bullish position in RPAY 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, Sylebra Capital Management was the largest shareholder of Repay Holdings Corporation (NASDAQ:RPAY), with a stake worth $52.1 million reported as of the end of September. Trailing Sylebra Capital Management was Engle Capital, which amassed a stake valued at $31 million. Driehaus Capital, Parian Global Management, 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 Engle Capital allocated the biggest weight to Repay Holdings Corporation (NASDAQ:RPAY), around 5% of its 13F portfolio. Parian Global Management is also relatively very bullish on the stock, designating 3.75 percent of its 13F equity portfolio to RPAY.
With a general bullishness amongst the heavyweights, key money managers were breaking ground themselves. Renaissance Technologies, created the largest position in Repay Holdings Corporation (NASDAQ:RPAY). Renaissance Technologies had $10.5 million invested in the company at the end of the quarter. Ravi Chopra’s Azora Capital also initiated a $9.2 million position during the quarter. The other funds with new positions in the stock are Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors, Anand Parekh’s Alyeska Investment Group, and Matthew L Pinz’s Pinz Capital.
Let’s now take a look at hedge fund activity in other stocks similar to Repay Holdings Corporation (NASDAQ:RPAY). These stocks are Oi SA (NYSE:OIBR), 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS), MAG Silver Corporation (NYSE:MAG), Delek US Holdings, Inc. (NYSE:DK), Red Rock Resorts, Inc. (NASDAQ:RRR), American Woodmark Corporation (NASDAQ:AMWD), and CorVel Corporation (NASDAQ:CRVL). This group of stocks’ market caps are similar to RPAY’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| OIBR | 7 | 98587 | -1 |
| FLWS | 23 | 98838 | 4 |
| MAG | 10 | 85741 | 2 |
| DK | 20 | 235338 | 4 |
| RRR | 30 | 243581 | 5 |
| AMWD | 16 | 38103 | 5 |
| CRVL | 15 | 109671 | 3 |
| Average | 17.3 | 129980 | 3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.3 hedge funds with bullish positions and the average amount invested in these stocks was $130 million. That figure was $174 million in RPAY’s case. Red Rock Resorts, Inc. (NASDAQ:RRR) is the most popular stock in this table. On the other hand Oi SA (NYSE:OIBR) is the least popular one with only 7 bullish hedge fund positions. Repay Holdings Corporation (NASDAQ:RPAY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for RPAY is 63.9. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 24.8% in 2020 through the end of September and beat the market by 19.3 percentage points. Unfortunately RPAY wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on RPAY were disappointed as the stock returned -4.6% in Q3 and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
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Disclosure: None. This article was originally published at Insider Monkey.
