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 SoFi Technologies Inc. (NASDAQ:SOFI).
Is SOFI a good stock to buy? SoFi Technologies Inc. (NASDAQ:SOFI) investors should pay attention to a decrease in hedge fund sentiment in recent months. SoFi Technologies Inc. (NASDAQ:SOFI) was in 33 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 39. Our calculations also showed that SOFI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
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 latest hedge fund action surrounding SoFi Technologies Inc. (NASDAQ:SOFI).
Do Hedge Funds Think SOFI Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 33 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -15% from the previous quarter. By comparison, 0 hedge funds held shares or bullish call options in SOFI a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).
More specifically, Silver Lake Partners was the largest shareholder of SoFi Technologies Inc. (NASDAQ:SOFI) , with a stake worth $611.6 million reported as of the end of September. Trailing Silver Lake Partners was Citadel Investment Group, which amassed a stake valued at $71.9 million. Miller Value Partners, Citadel Investment Group, and Millennium 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 Silver Lake Partners allocated the biggest weight to SoFi Technologies Inc. (NASDAQ:SOFI) , around 3.75% of its 13F portfolio. Ionic Capital Management is also relatively very bullish on the stock, earmarking 1.49 percent of its 13F equity portfolio to SOFI.
Because SoFi Technologies Inc. (NASDAQ:SOFI) has witnessed falling interest from the aggregate hedge fund industry, we can see that there exists a select few hedge funds that decided to sell off their positions entirely heading into Q4. Interestingly, Dan Loeb’s Third Point sold off the largest investment of all the hedgies monitored by Insider Monkey, totaling about $554 million in stock, and Doug Silverman and Alexander Klabin’s Senator Investment Group was right behind this move, as the fund sold off about $67.1 million worth. These moves are interesting, as aggregate hedge fund interest was cut by 6 funds heading into Q4.
Let’s now take a look at hedge fund activity in other stocks similar to SoFi Technologies Inc. (NASDAQ:SOFI) . We will take a look at Discovery Inc. (NASDAQ:DISCA), Whirlpool Corporation (NYSE:WHR), Santander Consumer USA Holdings Inc (NYSE:SC), Aluminum Corp. of China Limited (NYSE:ACH), Kimco Realty Corp (NYSE:KIM), Floor & Decor Holdings, Inc. (NYSE:FND), and DENTSPLY SIRONA Inc. (NASDAQ:XRAY). All of these stocks’ market caps are closest to SOFI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DISCA | 42 | 515818 | -2 |
| WHR | 29 | 1134128 | -3 |
| SC | 18 | 752098 | -8 |
| ACH | 7 | 20331 | 3 |
| KIM | 21 | 152556 | 1 |
| FND | 33 | 1417942 | 5 |
| XRAY | 35 | 745567 | 0 |
| Average | 26.4 | 676920 | -0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $677 million. That figure was $853 million in SOFI’s case. Discovery Inc. (NASDAQ:DISCA) is the most popular stock in this table. On the other hand Aluminum Corp. of China Limited (NYSE:ACH) is the least popular one with only 7 bullish hedge fund positions. SoFi Technologies Inc. (NASDAQ:SOFI) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SOFI is 61.5. 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 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 still beat the market by 5.6 percentage points. Hedge funds were also right about betting on SOFI as the stock returned 8.3% since the end of Q3 (through 11/30) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
