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 Harley-Davidson, Inc. (NYSE:HOG) based on that data.
Is Harley-Davidson, Inc. (NYSE:HOG) a worthy stock to buy now? The smart money was taking a bearish view. The number of long hedge fund positions dropped by 4 lately. Harley-Davidson, Inc. (NYSE:HOG) was in 33 hedge funds’ portfolios at the end of September. The all time high for this statistic is 37. Our calculations also showed that HOG isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 37 hedge funds in our database with HOG positions at the end of the second quarter.
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 we’re going to analyze the fresh hedge fund action encompassing Harley-Davidson, Inc. (NYSE:HOG).
Do Hedge Funds Think HOG Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 33 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -11% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in HOG over the last 25 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, H Partners Management held the most valuable stake in Harley-Davidson, Inc. (NYSE:HOG), which was worth $410 million at the end of the third quarter. On the second spot was D E Shaw which amassed $133.5 million worth of shares. Impala Asset Management, Brahman Capital, and Renaissance Technologies 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 H Partners Management allocated the biggest weight to Harley-Davidson, Inc. (NYSE:HOG), around 37.17% of its 13F portfolio. Impala Asset Management is also relatively very bullish on the stock, earmarking 8.06 percent of its 13F equity portfolio to HOG.
Seeing as Harley-Davidson, Inc. (NYSE:HOG) has faced declining sentiment from the smart money, we can see that there were a few hedgies that elected to cut their full holdings in the third quarter. Interestingly, Alexander Mitchell’s Scopus Asset Management dumped the biggest stake of the “upper crust” of funds watched by Insider Monkey, valued at about $38.9 million in call options. Peter Avellone’s fund, Cartenna Capital, also cut its call options, about $18.3 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 4 funds in the third quarter.
Let’s go over hedge fund activity in other stocks similar to Harley-Davidson, Inc. (NYSE:HOG). We will take a look at Southwestern Energy Company (NYSE:SWN), Colliers International Group Inc (NASDAQ:CIGI), Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI), Grupo Aeroportuario del Sureste (NYSE:ASR), Paysafe Limited (NYSE:PSFE), Luminar Technologies, Inc. (NASDAQ:LAZR), and Goosehead Insurance, Inc. (NASDAQ:GSHD). This group of stocks’ market valuations are closest to HOG’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SWN | 22 | 263603 | -5 |
| CIGI | 16 | 726941 | -1 |
| MRVI | 34 | 1068071 | 14 |
| ASR | 2 | 23593 | -3 |
| PSFE | 42 | 597243 | -8 |
| LAZR | 12 | 111108 | -9 |
| GSHD | 13 | 210178 | -1 |
| Average | 20.1 | 428677 | -1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 20.1 hedge funds with bullish positions and the average amount invested in these stocks was $429 million. That figure was $956 million in HOG’s case. Paysafe Limited (NYSE:PSFE) is the most popular stock in this table. On the other hand Grupo Aeroportuario del Sureste (NYSE:ASR) is the least popular one with only 2 bullish hedge fund positions. Harley-Davidson, Inc. (NYSE:HOG) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for HOG is 66.5. 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 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 beat the market again by 5.6 percentage points. Unfortunately HOG wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on HOG were disappointed as the stock returned 0.1% since the end of September (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 many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
