The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Intel Corporation (NASDAQ:INTC) based on those filings.
Is Intel Corporation (NASDAQ:INTC) a healthy stock for your portfolio? The smart money is buying. The number of bullish hedge fund bets advanced by 15 in recent months. Our calculations also showed that INTC 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.
Today there are a large number of methods investors employ to value their stock investments. A couple of the most underrated methods are hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the top picks of the top hedge fund managers can trounce their index-focused peers by a solid margin (see the details here).
Ken Fisher of Fisher Asset Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we asked astrophysicist Neil deGrasse Tyson about Tesla, Elon Musk, and his top stock picks. 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 S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let’s take a look at the fresh hedge fund action surrounding Intel Corporation (NASDAQ:INTC).
Hedge fund activity in Intel Corporation (NASDAQ:INTC)
At the end of the first quarter, a total of 73 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 26% from the fourth quarter of 2019. The graph below displays the number of hedge funds with bullish position in INTC over the last 18 quarters. So, let’s see 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 Intel Corporation (NASDAQ:INTC), with a stake worth $1504.6 million reported as of the end of September. Trailing Fisher Asset Management was Arrowstreet Capital, which amassed a stake valued at $1232.6 million. AQR Capital Management, Citadel Investment Group, and Citadel Investment Group 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 MFP Investors allocated the biggest weight to Intel Corporation (NASDAQ:INTC), around 22.57% of its 13F portfolio. Albar Capital is also relatively very bullish on the stock, setting aside 16.09 percent of its 13F equity portfolio to INTC.
Consequently, key hedge funds were breaking ground themselves. Holocene Advisors, managed by Brandon Haley, established the biggest position in Intel Corporation (NASDAQ:INTC). Holocene Advisors had $148 million invested in the company at the end of the quarter. Alex Sacerdote’s Whale Rock Capital Management also made a $133.4 million investment in the stock during the quarter. The other funds with brand new INTC positions are Brian Ashford-Russell and Tim Woolley’s Polar Capital, Dmitry Balyasny’s Balyasny Asset Management, and Larry Chen and Terry Zhang’s Tairen Capital.
Let’s now take a look at hedge fund activity in other stocks similar to Intel Corporation (NASDAQ:INTC). We will take a look at Verizon Communications Inc. (NYSE:VZ), AT&T Inc. (NYSE:T), The Home Depot, Inc. (NYSE:HD), and Merck & Co., Inc. (NYSE:MRK). All of these stocks’ market caps match INTC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| VZ | 68 | 2673270 | 3 |
| T | 57 | 1646079 | 7 |
| HD | 87 | 3585582 | -4 |
| MRK | 78 | 5025553 | 1 |
| Average | 72.5 | 3232621 | 1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 72.5 hedge funds with bullish positions and the average amount invested in these stocks was $3233 million. That figure was $5959 million in INTC’s case. The Home Depot, Inc. (NYSE:HD) is the most popular stock in this table. On the other hand AT&T Inc. (NYSE:T) is the least popular one with only 57 bullish hedge fund positions. Intel Corporation (NASDAQ:INTC) is not the most popular stock in this group but hedge fund interest is still above average. 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 7.9% in 2020 through May 22nd but still beat the market by 15.6 percentage points. Hedge funds were also right about betting on INTC, though not to the same extent, as the stock returned 15.7% during the first two months of the second quarter (through May 22nd) and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
