We at Insider Monkey have gone over 867 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 September 30th. In this article, we look at what those funds think of Amazon.com, Inc. (NASDAQ:AMZN) based on that data.
Is AMZN a good stock to buy? Amazon.com, Inc. (NASDAQ:AMZN) was in 242 hedge funds’ portfolios at the end of September. The all time high for this statistic is 273. AMZN investors should be aware of a decrease in activity from the world’s largest hedge funds recently. There were 271 hedge funds in our database with AMZN holdings at the end of June. Our calculations also showed that AMZN ranked #3 among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Chase Coleman of Tiger Global
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. Keeping this in mind we’re going to take a look at the recent hedge fund action encompassing Amazon.com, Inc. (NASDAQ:AMZN).
Do Hedge Funds Think AMZN Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 242 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -11% from the second quarter of 2021. The graph below displays the number of hedge funds with bullish position in AMZN over the last 25 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Citadel Investment Group was the largest shareholder of Amazon.com, Inc. (NASDAQ:AMZN), with a stake worth $12855 million reported as of the end of September. Trailing Citadel Investment Group was Fisher Asset Management, which amassed a stake valued at $6343.9 million. Eagle Capital Management, Tiger Global Management LLC, and Berkshire Hathaway 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 Skye Global Management allocated the biggest weight to Amazon.com, Inc. (NASDAQ:AMZN), around 27.18% of its 13F portfolio. VGI Partners is also relatively very bullish on the stock, earmarking 26.95 percent of its 13F equity portfolio to AMZN.
Due to the fact that Amazon.com, Inc. (NASDAQ:AMZN) has experienced bearish sentiment from hedge fund managers, we can see that there were a few hedgies who were dropping their full holdings in the third quarter. Interestingly, Masayoshi Son’s SB Management dumped the largest position of the 750 funds followed by Insider Monkey, totaling about $5653.3 million in stock, and Renaissance Technologies was right behind this move, as the fund dropped about $896.7 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 29 funds in the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Amazon.com, Inc. (NASDAQ:AMZN). These stocks are Facebook Inc (NASDAQ:FB), Tesla Inc. (NASDAQ:TSLA), Berkshire Hathaway Inc. (NYSE:BRK-B), Taiwan Semiconductor Mfg. Co. Ltd. (NYSE:TSM), NVIDIA Corporation (NASDAQ:NVDA), JPMorgan Chase & Co. (NYSE:JPM), and Visa Inc (NYSE:V). All of these stocks’ market caps are similar to AMZN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| FB | 248 | 38569582 | -18 |
| TSLA | 60 | 10645154 | 0 |
| BRK-B | 106 | 19463815 | -10 |
| TSM | 67 | 9511459 | 3 |
| NVDA | 83 | 10050216 | -3 |
| JPM | 101 | 5635067 | -7 |
| V | 143 | 26169435 | -19 |
| Average | 115.4 | 17149247 | -7.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 115.4 hedge funds with bullish positions and the average amount invested in these stocks was $17149 million. That figure was $42553 million in AMZN’s case. Facebook Inc (NASDAQ:FB) is the most popular stock in this table. On the other hand Tesla Inc. (NASDAQ:TSLA) is the least popular one with only 60 bullish hedge fund positions. Amazon.com, Inc. (NASDAQ:AMZN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for AMZN is 95.6. 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on AMZN as the stock returned 6.8% since the end of Q3 (through 11/30) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
