We at Insider Monkey have gone over 817 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 Gentex Corporation (NASDAQ:GNTX) based on that data.
Gentex Corporation (NASDAQ:GNTX) has seen an increase in hedge fund sentiment of late. Gentex Corporation (NASDAQ:GNTX) was in 40 hedge funds’ portfolios at the end of September. The all time high for this statistic is 38. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 38 hedge funds in our database with GNTX holdings at the end of June. Our calculations also showed that GNTX isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 66 percentage points since March 2017 (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 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Phillip Gross of Adage Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 15 best blue chip stocks to buy to pick the best large-cap stocks to buy. 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. With all of this in mind let’s take a peek at the new hedge fund action regarding Gentex Corporation (NASDAQ:GNTX).
Do Hedge Funds Think GNTX Is A Good Stock To Buy Now?
At third quarter’s end, a total of 40 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 5% from the previous quarter. The graph below displays the number of hedge funds with bullish position in GNTX over the last 21 quarters. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Gentex Corporation (NASDAQ:GNTX), which was worth $118 million at the end of the third quarter. On the second spot was Adage Capital Management which amassed $91.8 million worth of shares. Nitorum Capital, Royce & Associates, and Point72 Asset Management 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 Nitorum Capital allocated the biggest weight to Gentex Corporation (NASDAQ:GNTX), around 3.41% of its 13F portfolio. SG Capital Management is also relatively very bullish on the stock, setting aside 2.67 percent of its 13F equity portfolio to GNTX.
As aggregate interest increased, specific money managers were breaking ground themselves. SG Capital Management, managed by Ken Grossman and Glen Schneider, established the most valuable position in Gentex Corporation (NASDAQ:GNTX). SG Capital Management had $9.3 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also made a $5.4 million investment in the stock during the quarter. The following funds were also among the new GNTX investors: Ken Griffin’s Citadel Investment Group, Bruce Kovner’s Caxton Associates LP, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s check out hedge fund activity in other stocks similar to Gentex Corporation (NASDAQ:GNTX). We will take a look at Gerdau SA (NYSE:GGB), Commerce Bancshares, Inc. (NASDAQ:CBSH), Perrigo Co Plc (NYSE:PRGO), CubeSmart (NYSE:CUBE), American Airlines Group Inc (NASDAQ:AAL), Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA), and Herbalife Nutrition Ltd. (NYSE:HLF). This group of stocks’ market caps match GNTX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GGB | 11 | 134303 | 1 |
| CBSH | 15 | 50769 | -1 |
| PRGO | 29 | 370821 | -4 |
| CUBE | 18 | 229025 | -6 |
| AAL | 37 | 208177 | -10 |
| MNTA | 35 | 1256999 | -7 |
| HLF | 36 | 2374897 | 0 |
| Average | 25.9 | 660713 | -3.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.9 hedge funds with bullish positions and the average amount invested in these stocks was $661 million. That figure was $603 million in GNTX’s case. American Airlines Group Inc (NASDAQ:AAL) is the most popular stock in this table. On the other hand Gerdau SA (NYSE:GGB) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Gentex Corporation (NASDAQ:GNTX) is more popular among hedge funds. Our overall hedge fund sentiment score for GNTX is 87. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks returned 30.7% in 2020 through December 14th but still managed to beat the market by 15.8 percentage points. Hedge funds were also right about betting on GNTX as the stock returned 28.8% since the end of September (through 12/14) 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.
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Disclosure: None. This article was originally published at Insider Monkey.
