We at Insider Monkey have gone over 873 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 June 30th. In this article, we look at what those funds think of APi Group Corporation (NYSE:APG) based on that data.
Is APi Group Corporation (NYSE:APG) the right investment to pursue these days? Money managers were buying. The number of bullish hedge fund positions rose by 1 lately. APi Group Corporation (NYSE:APG) was in 34 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 33. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that APG isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 33 hedge funds in our database with APG positions at the end of the first quarter.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
David Harding of Winton Capital Management
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Do Hedge Funds Think APG Is A Good Stock To Buy Now?
At Q2’s end, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards APG over the last 24 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
More specifically, Viking Global was the largest shareholder of APi Group Corporation (NYSE:APG), with a stake worth $696.3 million reported as of the end of June. Trailing Viking Global was Senator Investment Group, which amassed a stake valued at $94 million. Permian Investment Partners, Empyrean Capital Partners, and ADW Capital 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 ADW Capital allocated the biggest weight to APi Group Corporation (NYSE:APG), around 20.26% of its 13F portfolio. Permian Investment Partners is also relatively very bullish on the stock, setting aside 9.39 percent of its 13F equity portfolio to APG.
As aggregate interest increased, key money managers have been driving this bullishness. Renaissance Technologies, initiated the largest position in APi Group Corporation (NYSE:APG). Renaissance Technologies had $8.6 million invested in the company at the end of the quarter. Mika Toikka’s AlphaCrest Capital Management also initiated a $0.9 million position during the quarter. The other funds with brand new APG positions are David Harding’s Winton Capital Management, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors, and Donald Sussman’s Paloma Partners.
Let’s now take a look at hedge fund activity in other stocks similar to APi Group Corporation (NYSE:APG). These stocks are Hudson Pacific Properties Inc (NYSE:HPP), Sanderson Farms, Inc. (NASDAQ:SAFM), PNM Resources, Inc. (NYSE:PNM), Range Resources Corp. (NYSE:RRC), Safehold Inc. (NYSE:SAFE), Cardlytics, Inc. (NASDAQ:CDLX), and HUYA Inc. (NYSE:HUYA). This group of stocks’ market valuations are closest to APG’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HPP | 18 | 127645 | 2 |
| SAFM | 33 | 298730 | 15 |
| PNM | 27 | 715188 | 1 |
| RRC | 25 | 493861 | -1 |
| SAFE | 6 | 7173 | -2 |
| CDLX | 29 | 1182760 | -9 |
| HUYA | 11 | 89812 | -2 |
| Average | 21.3 | 416453 | 0.6 |
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 $416 million. That figure was $1221 million in APG’s case. Sanderson Farms, Inc. (NASDAQ:SAFM) is the most popular stock in this table. On the other hand Safehold Inc. (NYSE:SAFE) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks APi Group Corporation (NYSE:APG) is more popular among hedge funds. Our overall hedge fund sentiment score for APG is 86. 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. 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 21.8% in 2021 through October 11th and still beat the market by 4.4 percentage points. Unfortunately APG wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on APG were disappointed as the stock returned -3% since the end of the second quarter (through 10/11) 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 most of these stocks already outperformed the market since 2019.
Follow Api Group Corp (NYSE:APG)
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Disclosure: None. This article was originally published at Insider Monkey.
