Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industry and media insiders on top of that. Individual investors can piggyback the hedge funds employing these talents and can benefit from their vast resources and knowledge in that way. We analyze quarterly 13F filings of nearly 750 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has the potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about Energizer Holdings, Inc. (NYSE:ENR).
Energizer Holdings, Inc. (NYSE:ENR) has experienced a decrease in activity from the world’s largest hedge funds of late. ENR was in 21 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 26 hedge funds in our database with ENR positions at the end of the previous quarter. Our calculations also showed that enr isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (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 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We’re going to view the key hedge fund action encompassing Energizer Holdings, Inc. (NYSE:ENR).
What have hedge funds been doing with Energizer Holdings, Inc. (NYSE:ENR)?
At Q4’s end, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of -19% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards ENR over the last 14 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Energizer Holdings, Inc. (NYSE:ENR) was held by GAMCO Investors, which reported holding $62.9 million worth of stock at the end of September. It was followed by Armistice Capital with a $48.2 million position. Other investors bullish on the company included Renaissance Technologies, Soros Fund Management, and Maverick Capital.
Due to the fact that Energizer Holdings, Inc. (NYSE:ENR) has witnessed bearish sentiment from the entirety of the hedge funds we track, logic holds that there were a few hedge funds who sold off their full holdings by the end of the third quarter. Interestingly, Alexander Mitchell’s Scopus Asset Management said goodbye to the biggest position of the 700 funds monitored by Insider Monkey, totaling an estimated $52.3 million in stock, and Brett Huckelbridge’s Steel Canyon Capital was right behind this move, as the fund said goodbye to about $10 million worth. These transactions are intriguing to say the least, as total hedge fund interest dropped by 5 funds by the end of the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Energizer Holdings, Inc. (NYSE:ENR) but similarly valued. These stocks are Science Applications International Corp (NYSE:SAIC), Old National Bancorp (NASDAQ:ONB), Corelogic Inc (NYSE:CLGX), and Akcea Therapeutics, Inc. (NASDAQ:AKCA). This group of stocks’ market valuations match ENR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SAIC | 24 | 192455 | 0 |
| ONB | 7 | 29032 | 1 |
| CLGX | 19 | 264131 | -1 |
| AKCA | 6 | 30018 | 0 |
| Average | 14 | 128909 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $129 million. That figure was $243 million in ENR’s case. Science Applications International Corp (NYSE:SAIC) is the most popular stock in this table. On the other hand Akcea Therapeutics, Inc. (NASDAQ:AKCA) is the least popular one with only 6 bullish hedge fund positions. Energizer Holdings, Inc. (NYSE:ENR) is not the most popular stock in this group but hedge fund interest is still above average. 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 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately ENR wasn’t nearly as popular as these 15 stock and hedge funds that were betting on ENR were disappointed as the stock returned 8.5% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
