The Insider Monkey team has completed processing the quarterly 13F filings for the March quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Viad Corp (NYSE:VVI).
Is Viad Corp (NYSE:VVI) a marvelous stock to buy now? The smart money is getting less bullish. The number of bullish hedge fund positions shrunk by 2 lately. Our calculations also showed that VVI isn’t among the 30 most popular stocks among hedge funds. VVI was in 13 hedge funds’ portfolios at the end of March. There were 15 hedge funds in our database with VVI holdings at the end of the previous quarter.
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 has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We’re going to take a look at the latest hedge fund action regarding Viad Corp (NYSE:VVI).
How have hedgies been trading Viad Corp (NYSE:VVI)?
At Q1’s end, a total of 13 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -13% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in VVI over the last 15 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Viad Corp (NYSE:VVI) was held by Moab Capital Partners, which reported holding $82.1 million worth of stock at the end of March. It was followed by GMT Capital with a $39 million position. Other investors bullish on the company included Third Avenue Management, Manatuck Hill Partners, and Cannell Capital.
Due to the fact that Viad Corp (NYSE:VVI) has witnessed declining sentiment from the aggregate hedge fund industry, we can see that there lies a certain “tier” of hedgies that decided to sell off their positions entirely by the end of the third quarter. Intriguingly, Chuck Royce’s Royce & Associates sold off the biggest position of the 700 funds watched by Insider Monkey, valued at about $3.3 million in stock, and Matthew Hulsizer’s PEAK6 Capital Management was right behind this move, as the fund said goodbye to about $0.3 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 2 funds by the end of the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Viad Corp (NYSE:VVI). These stocks are At Home Group Inc. (NYSE:HOME), Bitauto Hldg Ltd (NYSE:BITA), PPDAI Group Inc. (NYSE:PPDF), and Denny’s Corporation (NASDAQ:DENN). This group of stocks’ market values are similar to VVI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HOME | 32 | 247769 | 8 |
| BITA | 7 | 11115 | 0 |
| PPDF | 12 | 8046 | 6 |
| DENN | 19 | 171859 | 0 |
| Average | 17.5 | 109697 | 3.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.5 hedge funds with bullish positions and the average amount invested in these stocks was $110 million. That figure was $146 million in VVI’s case. At Home Group Inc. (NYSE:HOME) is the most popular stock in this table. On the other hand Bitauto Hldg Ltd (NYSE:BITA) is the least popular one with only 7 bullish hedge fund positions. Viad Corp (NYSE:VVI) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. A small number of hedge funds were also right about betting on VVI as the stock returned 19.1% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.
