Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Roblox Corporation (NYSE:RBLX) based on that data and determine whether they were really smart about the stock.
Roblox Corporation (NYSE:RBLX) investors should be aware of an increase in support from the world’s most elite money managers of late. Roblox Corporation (NYSE:RBLX) was in 50 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic was previously 49. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 49 hedge funds in our database with RBLX holdings at the end of June. Our calculations also showed that RBLX isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Alex Sacerdote of Whale Rock Capital Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind let’s check out the new hedge fund action encompassing Roblox Corporation (NYSE:RBLX).
Do Hedge Funds Think RBLX Is A Good Stock To Buy Now?
At the end of September, a total of 50 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 2% from the previous quarter. The graph below displays the number of hedge funds with bullish position in RBLX over the last 25 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Chase Coleman’s Tiger Global Management LLC has the largest position in Roblox Corporation (NYSE:RBLX), worth close to $1.3169 billion, corresponding to 2.5% of its total 13F portfolio. Sitting at the No. 2 spot is Philippe Laffont of Coatue Management, with a $552.7 million position; 2.2% of its 13F portfolio is allocated to the stock. Some other professional money managers with similar optimism comprise Joel Ramin’s 12 West Capital Management, Brad Gerstner’s Altimeter Capital Management and Alex Sacerdote’s Whale Rock Capital Management. In terms of the portfolio weights assigned to each position 12 West Capital Management allocated the biggest weight to Roblox Corporation (NYSE:RBLX), around 12.79% of its 13F portfolio. Himension Capital is also relatively very bullish on the stock, designating 11.3 percent of its 13F equity portfolio to RBLX.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. HMI Capital, managed by Mick Hellman, initiated the biggest position in Roblox Corporation (NYSE:RBLX). HMI Capital had $144.9 million invested in the company at the end of the quarter. Gil Simon’s SoMa Equity Partners also made a $33.3 million investment in the stock during the quarter. The following funds were also among the new RBLX investors: David Costen Haley’s HBK Investments, Jeffrey Hoffner’s Engle Capital, and Edward Goodnow’s Goodnow Investment Group.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Roblox Corporation (NYSE:RBLX) but similarly valued. These stocks are Ambev SA (NYSE:ABEV), Southern Copper Corporation (NYSE:SCCO), Canadian Pacific Railway Limited (NYSE:CP), Newmont Corporation (NYSE:NEM), Canadian Natural Resources Limited (NYSE:CNQ), National Grid plc (NYSE:NGG), and Spotify Technology S.A. (NYSE:SPOT). This group of stocks’ market caps are closest to RBLX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ABEV | 15 | 79897 | -3 |
| SCCO | 23 | 403491 | 0 |
| CP | 38 | 6638996 | 13 |
| NEM | 48 | 774451 | -7 |
| CNQ | 27 | 956988 | 0 |
| NGG | 5 | 314057 | -2 |
| SPOT | 48 | 3038733 | 0 |
| Average | 29.1 | 1743802 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.1 hedge funds with bullish positions and the average amount invested in these stocks was $1744 million. That figure was $3576 million in RBLX’s case. Newmont Corporation (NYSE:NEM) is the most popular stock in this table. On the other hand National Grid plc (NYSE:NGG) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Roblox Corporation (NYSE:RBLX) is more popular among hedge funds. Our overall hedge fund sentiment score for RBLX 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 29.6% in 2021 and still beat the market by 3.6 percentage points. Unfortunately, RBLX wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on RBLX were disappointed as the stock returned -12.8% since the end of the third quarter (through 1/31) 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 all of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
