Here’s Why Apple Inc. (AAPL) Is in Spotlight Today

The US market opened higher on Wednesday, amid crude futures near another monthly high and many investors seemingly unconcerned about the future interest rate raises ahead. One of the stocks that opened higher today is Apple Inc. (NASDAQ:AAPL). In addition to developing electric cars and other products that might diversify Apple’s dependence from the iPhone, Apple Inc. (NASDAQ:AAPL) is hard at work at producing its rendition of Amazon.com, Inc. (NASDAQ:AMZN)’s hit Echo, according the The Information. The news site reported that Apple will use Siri to power the device, which can do many of the things Echo does, including turning on music, setting a timer, or reading news headlines. Apple will also open Siri to third party developers through a SDK. Although the Echo doesn’t exactly bring in the profits for Amazon.com like the iPhone does for Apple, the device is seen as a potential center of the connected home. Given the importance of owning the center, Apple is right to throw its considerable resources at developing a new rendition. Even though the impact of Apple’s new product may not affect its financial results significantly, at least not in the near future, the diversification into new industries will be a positive sign for smart money investors, who have been piling into Apple, according to our data.

Apple Inc. (NASDAQ:AAPL) shareholders have witnessed an increase in hedge fund interest in recent months. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Alphabet Inc (NASDAQ:GOOGL) and Microsoft Corporation (NASDAQ:MSFT) to gather more data points.

According to most stock holders, hedge funds are seen as underperforming, outdated financial vehicles of the past. While there are over 8000 funds with their doors open at the moment, Our experts hone in on the elite of this group, about 700 funds. These hedge fund managers administer the lion’s share of all hedge funds’ total capital, and by keeping track of their best stock picks, Insider Monkey has unsheathed various investment strategies that have historically outstripped the market. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 12 percentage points a year for a decade in their back tests.

Now, we’re going to take a gander at the latest action surrounding Apple Inc. (NASDAQ:AAPL).

At the end of the first quarter, a total of 152 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 14% from one quarter earlier. With hedge funds’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Soroban Capital Partners, managed by Eric W. Mandelblatt, holds the largest position in Apple Inc. (NASDAQ:AAPL). Soroban Capital Partners has a $1.6872 billion call position in the stock, comprising 13.6% of its 13F portfolio. Sitting at the No. 2 spot is Fisher Asset Management, overseen by Ken Fisher, which holds a $1.243 billion position; the fund has 2.4% of its 13F portfolio invested in the stock. Remaining professional money managers with similar optimism encompass Warren Buffett’s Berkshire Hathaway, Phill Gross and Robert Atchinson’s Adage Capital Management and David Einhorn’s Greenlight Capital.

Since Apple registered an increase in the number of funds with long positions, on the next page, we are going to look at some funds that initiated stakes during the first three months 2016.

As industrywide interest jumped, key money managers were leading the bulls’ herd. Soroban Capital Partners, managed by Eric W. Mandelblatt, assembled the most valuable call position in Apple Inc. (NASDAQ:AAPL). Soroban Capital Partners had $1.6872 billion invested in the company at the end of the quarter. Warren Buffett’s Berkshire Hathaway also initiated a $1.0694 billion position during the quarter. The other funds with new positions in the stock are Eric W. Mandelblatt’s Soroban Capital Partners, John Griffin’s Blue Ridge Capital, and Karthik Sarma’s SRS Investment Management.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Apple Inc. (NASDAQ:AAPL) but similarly valued. We will take a look at Alphabet Inc (NASDAQ:GOOGL), Alphabet Inc (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT), and Berkshire Hathaway Inc. (NYSE:BRK-B). This group of stocks’ market caps match AAPL’s market cap.

As you can see these stocks had an average of 128 hedge funds with bullish positions and the average amount invested in these stocks was $17573 million. That figure was $14822 million in AAPL’s case. Alphabet Inc (NASDAQ:GOOGL) is the most popular stock in this table. On the other hand Berkshire Hathaway Inc. (NYSE:BRK-B) is the least popular one with only 71 bullish hedge fund positions. Apple Inc. (NASDAQ:AAPL) 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. In this regard GOOGL might be a better candidate to consider a long position.

Disclosure: None