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 866 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 Smith & Wesson Brands, Inc. (NASDAQ:SWBI)?
Is Smith & Wesson Brands, Inc. (NASDAQ:SWBI) a cheap investment right now? Hedge funds were getting less bullish. The number of bullish hedge fund bets decreased by 2 in recent months. Smith & Wesson Brands, Inc. (NASDAQ:SWBI) was in 18 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 24. Our calculations also showed that SWBI isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 20 hedge funds in our database with SWBI positions at the end of the fourth quarter.
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Do Hedge Funds Think SWBI Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from the fourth quarter of 2020. The graph below displays the number of hedge funds with bullish position in SWBI over the last 23 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).
The largest stake in Smith & Wesson Brands, Inc. (NASDAQ:SWBI) was held by Renaissance Technologies, which reported holding $64.8 million worth of stock at the end of December. It was followed by Citadel Investment Group with a $12.1 million position. Other investors bullish on the company included GLG Partners, Citadel Investment Group, and AQR Capital Management. In terms of the portfolio weights assigned to each position Navellier & Associates allocated the biggest weight to Smith & Wesson Brands, Inc. (NASDAQ:SWBI), around 0.4% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, dishing out 0.08 percent of its 13F equity portfolio to SWBI.
Since Smith & Wesson Brands, Inc. (NASDAQ:SWBI) has faced bearish sentiment from the entirety of the hedge funds we track, logic holds that there was a specific group of money managers that decided to sell off their full holdings heading into Q2. Intriguingly, Blair Baker’s Precept Capital Management said goodbye to the biggest position of the 750 funds monitored by Insider Monkey, worth close to $0.7 million in stock, and Matthew Hulsizer’s PEAK6 Capital Management was right behind this move, as the fund cut about $0.6 million worth. These moves are important to note, as total hedge fund interest fell by 2 funds heading into Q2.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Smith & Wesson Brands, Inc. (NASDAQ:SWBI) but similarly valued. These stocks are ARMOUR Residential REIT, Inc. (NYSE:ARR), Federal Agricultural Mortgage Corp. (NYSE:AGM), Suburban Propane Partners LP (NYSE:SPH), RPT Realty (NYSE:RPT), Renalytix AI plc (NASDAQ:RNLX), Republic Bancorp, Inc. KY (NASDAQ:RBCAA), and Adecoagro SA (NYSE:AGRO). This group of stocks’ market values resemble SWBI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ARR | 9 | 22233 | -4 |
| AGM | 7 | 20790 | -4 |
| SPH | 2 | 3805 | -3 |
| RPT | 8 | 17948 | -1 |
| RNLX | 7 | 33180 | 1 |
| RBCAA | 5 | 10774 | 0 |
| AGRO | 14 | 242146 | 4 |
| Average | 7.4 | 50125 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 7.4 hedge funds with bullish positions and the average amount invested in these stocks was $50 million. That figure was $100 million in SWBI’s case. Adecoagro SA (NYSE:AGRO) is the most popular stock in this table. On the other hand Suburban Propane Partners LP (NYSE:SPH) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Smith & Wesson Brands, Inc. (NASDAQ:SWBI) is more popular among hedge funds. Our overall hedge fund sentiment score for SWBI is 75.5. 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 returned 28.5% in 2021 through July 23rd but still managed to beat the market by 10.1 percentage points. Hedge funds were also right about betting on SWBI as the stock returned 34.3% since the end of March (through 7/23) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Follow Smith & Wesson Brands Inc. (NASDAQ:SWBI)
Follow Smith & Wesson Brands Inc. (NASDAQ:SWBI)
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Disclosure: None. This article was originally published at Insider Monkey.
