The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. What do these smart investors think about Viavi Solutions Inc (NASDAQ:VIAV)?
Viavi Solutions Inc (NASDAQ:VIAV) has experienced a decrease in support from the world’s most elite money managers lately. VIAV was in 31 hedge funds’ portfolios at the end of the first quarter of 2020. There were 37 hedge funds in our database with VIAV holdings at the end of the previous quarter. Our calculations also showed that VIAV isn’t among the 30 most popular stocks among hedge funds (click for Q1 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.
To most investors, hedge funds are viewed as unimportant, outdated financial tools of yesteryear. While there are more than 8000 funds in operation at the moment, Our researchers look at the aristocrats of this group, about 850 funds. It is estimated that this group of investors shepherd the majority of the hedge fund industry’s total asset base, and by following their inimitable stock picks, Insider Monkey has brought to light a few investment strategies that have historically beaten Mr. Market. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Phill Gross of Adage Capital Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s check out the fresh hedge fund action regarding Viavi Solutions Inc (NASDAQ:VIAV).
How are hedge funds trading Viavi Solutions Inc (NASDAQ:VIAV)?
At the end of the first quarter, a total of 31 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -16% from one quarter earlier. On the other hand, there were a total of 28 hedge funds with a bullish position in VIAV a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Viavi Solutions Inc (NASDAQ:VIAV) was held by Citadel Investment Group, which reported holding $80 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $70.8 million position. Other investors bullish on the company included Columbus Circle Investors, Toronado Partners, and Adage Capital Management. In terms of the portfolio weights assigned to each position Toronado Partners allocated the biggest weight to Viavi Solutions Inc (NASDAQ:VIAV), around 7.09% of its 13F portfolio. Ratan Capital Group is also relatively very bullish on the stock, earmarking 2.06 percent of its 13F equity portfolio to VIAV.
Since Viavi Solutions Inc (NASDAQ:VIAV) has witnessed declining sentiment from the aggregate hedge fund industry, it’s easy to see that there lies a certain “tier” of hedgies who sold off their full holdings last quarter. Interestingly, Michael Platt and William Reeves’s BlueCrest Capital Mgmt. dumped the biggest position of all the hedgies watched by Insider Monkey, valued at about $26.7 million in stock. D. E. Shaw’s fund, D E Shaw, also said goodbye to its stock, about $10.8 million worth. These transactions are intriguing to say the least, as total hedge fund interest dropped by 6 funds last quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Viavi Solutions Inc (NASDAQ:VIAV) but similarly valued. We will take a look at CRISPR Therapeutics AG (NASDAQ:CRSP), Inovalon Holdings Inc (NASDAQ:INOV), Radian Group Inc (NYSE:RDN), and bluebird bio Inc (NASDAQ:BLUE). This group of stocks’ market values are similar to VIAV’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CRSP | 31 | 197848 | 1 |
| INOV | 15 | 71699 | -1 |
| RDN | 28 | 121169 | -1 |
| BLUE | 27 | 286752 | -6 |
| Average | 25.25 | 169367 | -1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.25 hedge funds with bullish positions and the average amount invested in these stocks was $169 million. That figure was $305 million in VIAV’s case. CRISPR Therapeutics AG (NASDAQ:CRSP) is the most popular stock in this table. On the other hand Inovalon Holdings Inc (NASDAQ:INOV) is the least popular one with only 15 bullish hedge fund positions. Viavi Solutions Inc (NASDAQ:VIAV) is not the most popular stock in this group but hedge fund interest is still above average. 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 8.3% in 2020 through the end of May but beat the market by 13.2 percentage points. Unfortunately VIAV wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on VIAV were disappointed as the stock returned 3.4% during the same time period 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.
