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. One of these stocks was Vitru Limited (NASDAQ:VTRU).
Is VTRU a good stock to buy now? The best stock pickers were becoming more confident. The number of bullish hedge fund bets rose by 9 in recent months. Vitru Limited (NASDAQ:VTRU) was in 9 hedge funds’ portfolios at the end of the third quarter of 2020. Our calculations also showed that VTRU isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are dozens of metrics stock market investors have at their disposal to analyze stocks. A couple of the most innovative metrics are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the elite money managers can outperform their index-focused peers by a solid margin (see the details here).
Paul Tudor Jones of Tudor Investment Corp
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. With all of this in mind we’re going to analyze the fresh hedge fund action encompassing Vitru Limited (NASDAQ:VTRU).
Do Hedge Funds Think VTRU Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 9 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 9 from the second quarter of 2020. The graph below displays the number of hedge funds with bullish position in VTRU over the last 21 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Alyeska Investment Group held the most valuable stake in Vitru Limited (NASDAQ:VTRU), which was worth $6 million at the end of the third quarter. On the second spot was Millennium Management which amassed $1 million worth of shares. Tudor Investment Corp, Citadel Investment Group, and ExodusPoint Capital 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 Pinz Capital allocated the biggest weight to Vitru Limited (NASDAQ:VTRU), around 0.24% of its 13F portfolio. Alyeska Investment Group is also relatively very bullish on the stock, designating 0.09 percent of its 13F equity portfolio to VTRU.
Now, key hedge funds were breaking ground themselves. Alyeska Investment Group, managed by Anand Parekh, established the largest position in Vitru Limited (NASDAQ:VTRU). Alyeska Investment Group had $6 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $1 million investment in the stock during the quarter. The other funds with brand new VTRU positions are Paul Tudor Jones’s Tudor Investment Corp, Ken Griffin’s Citadel Investment Group, and Michael Gelband’s ExodusPoint Capital.
Let’s check out hedge fund activity in other stocks similar to Vitru Limited (NASDAQ:VTRU). We will take a look at Metalla Royalty & Streaming Ltd. (NYSE:MTA), Global Indemnity Group LLC (NASDAQ:GBLI), Titan Machinery Inc. (NASDAQ:TITN), Pulse Biosciences, Inc (NASDAQ:PLSE), Flushing Financial Corporation (NASDAQ:FFIC), Motorcar Parts of America, Inc. (NASDAQ:MPAA), and IMV Inc. (NASDAQ:IMV). This group of stocks’ market valuations are similar to VTRU’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MTA | 3 | 2860 | -1 |
| GBLI | 7 | 11899 | 3 |
| TITN | 14 | 17341 | 5 |
| PLSE | 2 | 449 | 0 |
| FFIC | 10 | 26432 | -1 |
| MPAA | 8 | 53762 | 0 |
| IMV | 5 | 2308 | 4 |
| Average | 7 | 16436 | 1.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $16 million. That figure was $11 million in VTRU’s case. Titan Machinery Inc. (NASDAQ:TITN) is the most popular stock in this table. On the other hand Pulse Biosciences, Inc (NASDAQ:PLSE) is the least popular one with only 2 bullish hedge fund positions. Vitru Limited (NASDAQ:VTRU) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for VTRU is 56.7. 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. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and still beat the market by 16.2 percentage points. Hedge funds were also right about betting on VTRU as the stock returned 12.1% since the end of Q3 (through 12/8) 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.