With the third-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the fourth quarter of 2021. One of these stocks was Group 1 Automotive, Inc. (NYSE:GPI).
Group 1 Automotive, Inc. (NYSE:GPI) investors should pay attention to an increase in hedge fund sentiment of late. Group 1 Automotive, Inc. (NYSE:GPI) was in 24 hedge funds’ portfolios at the end of September. The all time high for this statistic is 26. There were 21 hedge funds in our database with GPI positions at the end of the second quarter. Our calculations also showed that GPI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Ricky Sandler of Eminence Capital
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 new hedge fund action regarding Group 1 Automotive, Inc. (NYSE:GPI).
Do Hedge Funds Think GPI Is A Good Stock To Buy Now?
At Q3’s end, a total of 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 14% from the previous quarter. By comparison, 24 hedge funds held shares or bullish call options in GPI a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Ricky Sandler’s Eminence Capital has the most valuable position in Group 1 Automotive, Inc. (NYSE:GPI), worth close to $174.9 million, comprising 2.4% of its total 13F portfolio. On Eminence Capital’s heels is Lakewood Capital Management, led by Anthony Bozza, holding a $68.2 million position; 3% of its 13F portfolio is allocated to the stock. Other peers with similar optimism encompass Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Doug Gordon, Jon Hilsabeck and Don Jabro’s Shellback Capital and Israel Englander’s Millennium Management. In terms of the portfolio weights assigned to each position Cobalt Capital Management allocated the biggest weight to Group 1 Automotive, Inc. (NYSE:GPI), around 3.48% of its 13F portfolio. Lakewood Capital Management is also relatively very bullish on the stock, setting aside 3 percent of its 13F equity portfolio to GPI.
As one would reasonably expect, key money managers have jumped into Group 1 Automotive, Inc. (NYSE:GPI) headfirst. North Fourth Asset Management, managed by Anthony Joseph Vaccarino, established the largest call position in Group 1 Automotive, Inc. (NYSE:GPI). North Fourth Asset Management had $7.5 million invested in the company at the end of the quarter. Ken Heebner’s Capital Growth Management also initiated a $7.5 million position during the quarter. The following funds were also among the new GPI investors: Anthony Joseph Vaccarino’s North Fourth Asset Management, Matthew Hulsizer’s PEAK6 Capital Management, and Michael Gelband’s ExodusPoint Capital.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Group 1 Automotive, Inc. (NYSE:GPI) but similarly valued. These stocks are fuboTV Inc. (NYSE:FUBO), TechnipFMC plc (NYSE:FTI), HB Fuller Co (NYSE:FUL), ONE Gas Inc (NYSE:OGS), Viper Energy Partners LP (NASDAQ:VNOM), Cogent Communications Holdings Inc. (NASDAQ:CCOI), and Advanced Energy Industries, Inc. (NASDAQ:AEIS). This group of stocks’ market values are closest to GPI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| FUBO | 16 | 192491 | -2 |
| FTI | 28 | 334396 | 3 |
| FUL | 9 | 159538 | -3 |
| OGS | 16 | 31626 | 3 |
| VNOM | 8 | 108346 | -4 |
| CCOI | 20 | 284925 | -2 |
| AEIS | 17 | 56854 | 0 |
| Average | 16.3 | 166882 | -0.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.3 hedge funds with bullish positions and the average amount invested in these stocks was $167 million. That figure was $390 million in GPI’s case. TechnipFMC plc (NYSE:FTI) is the most popular stock in this table. On the other hand Viper Energy Partners LP (NASDAQ:VNOM) is the least popular one with only 8 bullish hedge fund positions. Group 1 Automotive, Inc. (NYSE:GPI) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GPI is 75.7. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 31.1% in 2021 through December 9th and beat the market again by 5.1 percentage points. Unfortunately GPI wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on GPI were disappointed as the stock returned 7.7% since the end of September (through 12/9) 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 many of these stocks already outperformed the market since 2019.
Follow Group 1 Automotive Inc (NYSE:GPI)
Follow Group 1 Automotive Inc (NYSE:GPI)
Suggested Articles:
- 10 Biggest Phone Companies In The World
- 10 Stocks to Buy to Profit from Post-COVID Economic Recovery
- 11 Best Lithium and Battery Stocks To Buy
Disclosure: None. This article was originally published at Insider Monkey.
