After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of June 28. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Evercore Inc. (NYSE:EVR).
Is Evercore Inc. (NYSE:EVR) a sound investment right now? Prominent investors are buying. The number of bullish hedge fund positions inched up by 1 lately. Our calculations also showed that EVR isn’t among the 30 most popular stocks among hedge funds (see the video below). EVR was in 26 hedge funds’ portfolios at the end of June. There were 25 hedge funds in our database with EVR positions at the end of the previous quarter.
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
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. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s analyze the recent hedge fund action regarding Evercore Inc. (NYSE:EVR).
What does smart money think about Evercore Inc. (NYSE:EVR)?
At the end of the second quarter, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 4% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards EVR over the last 16 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Israel Englander’s Millennium Management has the biggest position in Evercore Inc. (NYSE:EVR), worth close to $108.7 million, amounting to 0.2% of its total 13F portfolio. The second largest stake is held by Ken Griffin of Citadel Investment Group, with a $81.2 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining members of the smart money that are bullish comprise James Parsons’s Junto Capital Management, Renaissance Technologies and Dmitry Balyasny’s Balyasny Asset Management.
Consequently, some big names have jumped into Evercore Inc. (NYSE:EVR) headfirst. Azora Capital, managed by Ravi Chopra, assembled the most valuable position in Evercore Partners Inc. (NYSE:EVR). Azora Capital had $36 million invested in the company at the end of the quarter. Robert Pohly’s Samlyn Capital also made a $21.8 million investment in the stock during the quarter. The following funds were also among the new EVR investors: Peter Seuss’s Prana Capital Management, David Harding’s Winton Capital Management, and Matthew Tewksbury’s Stevens Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to Evercore Inc. (NYSE:EVR). We will take a look at BRP Inc. (NASDAQ:DOOO), Ultragenyx Pharmaceutical Inc (NASDAQ:RARE), Verint Systems Inc. (NASDAQ:VRNT), and Parsons Corporation (NYSE:PSN). This group of stocks’ market valuations match EVR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DOOO | 10 | 73075 | 0 |
| RARE | 16 | 249429 | -2 |
| VRNT | 23 | 424457 | 1 |
| PSN | 15 | 169178 | 15 |
| Average | 16 | 229035 | 3.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $229 million. That figure was $483 million in EVR’s case. Verint Systems Inc. (NASDAQ:VRNT) is the most popular stock in this table. On the other hand BRP Inc. (NASDAQ:DOOO) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Evercore Inc. (NYSE:EVR) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately EVR wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on EVR were disappointed as the stock returned -8.9% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market in Q3.
Disclosure: None. This article was originally published at Insider Monkey.
