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 Vishay Intertechnology (NYSE:VSH) was a good investment heading into the third quarter and how the stock traded in comparison to the top hedge fund picks.
Vishay Intertechnology (NYSE:VSH) was in 28 hedge funds’ portfolios at the end of June. The all time high for this statistics is 23. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. VSH has seen an increase in hedge fund sentiment recently. There were 23 hedge funds in our database with VSH holdings at the end of March. Our calculations also showed that VSH 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.
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 56 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 34% through August 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Donald Sussman of Paloma Partners
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. 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 we’re going to take a gander at the fresh hedge fund action encompassing Vishay Intertechnology (NYSE:VSH).
How are hedge funds trading Vishay Intertechnology (NYSE:VSH)?
At Q2’s end, a total of 28 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 22% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in VSH over the last 20 quarters. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
The largest stake in Vishay Intertechnology (NYSE:VSH) was held by Fisher Asset Management, which reported holding $68.7 million worth of stock at the end of September. It was followed by AQR Capital Management with a $60.3 million position. Other investors bullish on the company included Woodline Partners, Royce & Associates, and Lynrock Lake. In terms of the portfolio weights assigned to each position Mountaineer Partners Management allocated the biggest weight to Vishay Intertechnology (NYSE:VSH), around 7.02% of its 13F portfolio. Lynrock Lake is also relatively very bullish on the stock, dishing out 2.67 percent of its 13F equity portfolio to VSH.
With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. Deepcurrents Investment Group, managed by Steve Zheng, created the biggest position in Vishay Intertechnology (NYSE:VSH). Deepcurrents Investment Group had $7.3 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also initiated a $3 million position during the quarter. The other funds with new positions in the stock are Greg Eisner’s Engineers Gate Manager, Donald Sussman’s Paloma Partners, and Lee Ainslie’s Maverick Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Vishay Intertechnology (NYSE:VSH) but similarly valued. These stocks are Sensient Technologies Corporation (NYSE:SXT), LGI Homes Inc (NASDAQ:LGIH), ESCO Technologies Inc. (NYSE:ESE), Cleveland-Cliffs Inc (NYSE:CLF), Progyny, Inc. (NASDAQ:PGNY), Primo Water Corporation (NYSE:PRMW), and Shake Shack Inc (NYSE:SHAK). This group of stocks’ market caps are similar to VSH’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SXT | 23 | 170066 | 0 |
| LGIH | 22 | 108240 | 8 |
| ESE | 7 | 69080 | -1 |
| CLF | 25 | 161525 | 2 |
| PGNY | 19 | 64397 | 9 |
| PRMW | 31 | 624565 | -5 |
| SHAK | 22 | 458714 | 0 |
| Average | 21.3 | 236655 | 1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.3 hedge funds with bullish positions and the average amount invested in these stocks was $237 million. That figure was $334 million in VSH’s case. Primo Water Corporation (NYSE:PRMW) is the most popular stock in this table. On the other hand ESCO Technologies Inc. (NYSE:ESE) is the least popular one with only 7 bullish hedge fund positions. Vishay Intertechnology (NYSE:VSH) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for VSH is 83.8. 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 21.3% in 2020 through September 25th and beat the market by 17.7 percentage points. Unfortunately VSH wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on VSH were disappointed as the stock returned -0.4% 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.
Follow Vishay Intertechnology Inc (NYSE:VSH)
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Disclosure: None. This article was originally published at Insider Monkey.
