The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of September 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Lyft, Inc. (NASDAQ:LYFT).
Is Lyft, Inc. (NASDAQ:LYFT) a buy right now? Investors who are in the know were reducing their bets on the stock. The number of long hedge fund bets decreased by 10 recently. Lyft, Inc. (NASDAQ:LYFT) was in 33 hedge funds’ portfolios at the end of September. The all time high for this statistic is 71. Our calculations also showed that LYFT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 43 hedge funds in our database with LYFT holdings at the end of June.
David E. Shaw of D.E. Shaw
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 peek at the recent hedge fund action surrounding Lyft, Inc. (NASDAQ:LYFT).
Do Hedge Funds Think LYFT Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 33 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -23% from the previous quarter. By comparison, 32 hedge funds held shares or bullish call options in LYFT a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Among these funds, Citadel Investment Group held the most valuable stake in Lyft, Inc. (NASDAQ:LYFT), which was worth $254.6 million at the end of the third quarter. On the second spot was Alkeon Capital Management which amassed $253.3 million worth of shares. D E Shaw, Millennium Management, and Iridian 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 Cavalry Asset Management allocated the biggest weight to Lyft, Inc. (NASDAQ:LYFT), around 4.53% of its 13F portfolio. Anomaly Capital Management is also relatively very bullish on the stock, earmarking 4.46 percent of its 13F equity portfolio to LYFT.
Judging by the fact that Lyft, Inc. (NASDAQ:LYFT) has experienced falling interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of funds who were dropping their entire stakes heading into Q4. It’s worth mentioning that David Costen Haley’s HBK Investments cut the biggest investment of all the hedgies watched by Insider Monkey, valued at close to $119.4 million in stock. Nicolai Tangen’s fund, Ako Capital, also dropped its stock, about $118.1 million worth. These transactions are important to note, as total hedge fund interest dropped by 10 funds heading into Q4.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Lyft, Inc. (NASDAQ:LYFT) but similarly valued. We will take a look at Take-Two Interactive Software, Inc. (NASDAQ:TTWO), NICE Ltd (NASDAQ:NICE), Companhia Paranaense de Energia (NYSE:ELP), VICI Properties Inc. (NYSE:VICI), HEICO Corporation (NYSE:HEI), Amcor plc (NYSE:AMCR), and Quest Diagnostics Incorporated (NYSE:DGX). This group of stocks’ market valuations are closest to LYFT’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TTWO | 53 | 1196708 | -2 |
| NICE | 27 | 1119470 | 5 |
| ELP | 7 | 30561 | -6 |
| VICI | 47 | 1377694 | 10 |
| HEI | 35 | 719437 | -6 |
| AMCR | 19 | 214115 | 3 |
| DGX | 36 | 488311 | 5 |
| Average | 32 | 735185 | 1.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 32 hedge funds with bullish positions and the average amount invested in these stocks was $735 million. That figure was $900 million in LYFT’s case. Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is the most popular stock in this table. On the other hand Companhia Paranaense de Energia (NYSE:ELP) is the least popular one with only 7 bullish hedge fund positions. Lyft, Inc. (NASDAQ:LYFT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LYFT is 37.2. 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 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately LYFT wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on LYFT were disappointed as the stock returned -24.2% since the end of September (through 11/30) 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 Lyft Inc. (NASDAQ:LYFT)
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Disclosure: None. This article was originally published at Insider Monkey.
