Is ENR Stock A Buy or Sell?

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Energizer Holdings, Inc. (NYSE:ENR).

Is ENR stock a buy? Energizer Holdings, Inc. (NYSE:ENR) was in 26 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 28. ENR shareholders have witnessed a decrease in support from the world’s most elite money managers of late. There were 28 hedge funds in our database with ENR holdings at the end of September. Our calculations also showed that ENR isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 124 percentage points since March 2017 (see the details here).

Mario Gabelli of GAMCO Investors

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now let’s review the recent hedge fund action surrounding Energizer Holdings, Inc. (NYSE:ENR).

Do Hedge Funds Think ENR Is A Good Stock To Buy Now?

At the end of December, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of -7% from the third quarter of 2020. On the other hand, there were a total of 22 hedge funds with a bullish position in ENR a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, GAMCO Investors was the largest shareholder of Energizer Holdings, Inc. (NYSE:ENR), with a stake worth $74.2 million reported as of the end of December. Trailing GAMCO Investors was Armistice Capital, which amassed a stake valued at $41.3 million. Arrowstreet Capital, Point72 Asset Management, and Engineers Gate Manager 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 Armistice Capital allocated the biggest weight to Energizer Holdings, Inc. (NYSE:ENR), around 1.85% of its 13F portfolio. 12th Street Asset Management is also relatively very bullish on the stock, designating 0.75 percent of its 13F equity portfolio to ENR.

Due to the fact that Energizer Holdings, Inc. (NYSE:ENR) has faced falling interest from the aggregate hedge fund industry, it’s easy to see that there lies a certain “tier” of fund managers that decided to sell off their positions entirely in the fourth quarter. At the top of the heap, Brian Scudieri’s Kehrs Ridge Capital dropped the biggest position of the “upper crust” of funds followed by Insider Monkey, totaling about $6.2 million in stock. Franklin Parlamis’s fund, Aequim Alternative Investments, also sold off its stock, about $4.2 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 2 funds in the fourth 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. We will take a look at Mercury General Corporation (NYSE:MCY), NuVasive, Inc. (NASDAQ:NUVA), PJT Partners Inc (NYSE:PJT), 2U Inc (NASDAQ:TWOU), Apple Hospitality REIT Inc (NYSE:APLE), ExlService Holdings, Inc. (NASDAQ:EXLS), and Walker & Dunlop Inc. (NYSE:WD). All of these stocks’ market caps resemble ENR’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 19.7 hedge funds with bullish positions and the average amount invested in these stocks was $268 million. That figure was $170 million in ENR’s case. NuVasive, Inc. (NASDAQ:NUVA) is the most popular stock in this table. On the other hand Apple Hospitality REIT Inc (NYSE:APLE) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks Energizer Holdings, Inc. (NYSE:ENR) is more popular among hedge funds. Our overall hedge fund sentiment score for ENR is 80.9. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks returned 12.3% in 2021 through April 19th but still managed to beat the market by 0.9 percentage points. Hedge funds were also right about betting on ENR as the stock returned 19.4% since the end of December (through 4/19) 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.

Disclosure: None. This article was originally published at Insider Monkey.