After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of December 31st. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Shift4 Payments, Inc. (NYSE:FOUR).
Is FOUR stock a buy or sell? The smart money was taking a bullish view. The number of bullish hedge fund bets rose by 6 in recent months. Shift4 Payments, Inc. (NYSE:FOUR) was in 38 hedge funds’ portfolios at the end of December. The all time high for this statistic is 32. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that FOUR isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings). There were 32 hedge funds in our database with FOUR holdings at the end of September.
Chuck Royce of Royce & Associates
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Do Hedge Funds Think FOUR Is A Good Stock To Buy Now?
Heading into the first quarter of 2021, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of 19% from the third quarter of 2020. By comparison, 0 hedge funds held shares or bullish call options in FOUR a year ago. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).
More specifically, Southpoint Capital Advisors was the largest shareholder of Shift4 Payments, Inc. (NYSE:FOUR), with a stake worth $106.6 million reported as of the end of December. Trailing Southpoint Capital Advisors was Senator Investment Group, which amassed a stake valued at $67.9 million. Citadel Investment Group, Melvin Capital Management, and Jericho Capital 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 Hickory Lane Capital Management allocated the biggest weight to Shift4 Payments, Inc. (NYSE:FOUR), around 6.27% of its 13F portfolio. Center Lake Capital is also relatively very bullish on the stock, setting aside 3.4 percent of its 13F equity portfolio to FOUR.
As aggregate interest increased, some big names have been driving this bullishness. Southpoint Capital Advisors, managed by John Smith Clark, assembled the biggest position in Shift4 Payments, Inc. (NYSE:FOUR). Southpoint Capital Advisors had $106.6 million invested in the company at the end of the quarter. Gabriel Plotkin’s Melvin Capital Management also made a $37.8 million investment in the stock during the quarter. The following funds were also among the new FOUR investors: Josh Resnick’s Jericho Capital Asset Management, Chuck Royce’s Royce & Associates, and Adam Parker’s Center Lake Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Shift4 Payments, Inc. (NYSE:FOUR) but similarly valued. We will take a look at Phillips 66 Partners LP (NYSE:PSXP), PLDT Inc. (NYSE:PHI), Haemonetics Corporation (NYSE:HAE), Healthcare Trust Of America Inc (NYSE:HTA), Amicus Therapeutics, Inc. (NASDAQ:FOLD), Corelogic Inc (NYSE:CLGX), and Plains All American Pipeline, L.P. (NASDAQ:PAA). This group of stocks’ market values match FOUR’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PSXP | 4 | 36141 | 0 |
| PHI | 4 | 94680 | -4 |
| HAE | 32 | 691644 | 0 |
| HTA | 14 | 126469 | -5 |
| FOLD | 37 | 1944437 | -1 |
| CLGX | 46 | 1823427 | 1 |
| PAA | 10 | 74157 | 2 |
| Average | 21 | 684422 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $684 million. That figure was $561 million in FOUR’s case. Corelogic Inc (NYSE:CLGX) is the most popular stock in this table. On the other hand Phillips 66 Partners LP (NYSE:PSXP) is the least popular one with only 4 bullish hedge fund positions. Shift4 Payments, Inc. (NYSE:FOUR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FOUR is 80.5. 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 gained 5.3% in 2021 through March 19th and still beat the market by 0.8 percentage points. Hedge funds were also right about betting on FOUR as the stock returned 12.2% since the end of Q4 (through 3/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Shift4 Payments Inc. (NYSE:FOUR)
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Disclosure: None. This article was originally published at Insider Monkey.
