Is WBT Stock A Buy?

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 887 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their December 31st holdings, data that is available nowhere else. Should you consider Welbilt, Inc. (NYSE:WBT) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.

Is WBT stock a buy? Welbilt, Inc. (NYSE:WBT) investors should pay attention to an increase in support from the world’s most elite money managers in recent months. Welbilt, Inc. (NYSE:WBT) was in 25 hedge funds’ portfolios at the end of December. The all time high for this statistic is 28. There were 24 hedge funds in our database with WBT holdings at the end of September. Our calculations also showed that WBT isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

To the average investor there are many formulas market participants employ to assess their holdings. A pair of the best formulas are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the top picks of the elite hedge fund managers can outpace their index-focused peers by a superb margin (see the details here).

Jeffrey Gates of Gates Capital

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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. Keeping this in mind we’re going to take a look at the latest hedge fund action encompassing Welbilt, Inc. (NYSE:WBT).

Do Hedge Funds Think WBT Is A Good Stock To Buy Now?

At the end of December, a total of 25 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 4% from the previous quarter. The graph below displays the number of hedge funds with bullish position in WBT over the last 22 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Icahn Capital LP was the largest shareholder of Welbilt, Inc. (NYSE:WBT), with a stake worth $157.6 million reported as of the end of December. Trailing Icahn Capital LP was Gates Capital Management, which amassed a stake valued at $65 million. Citadel Investment Group, D E Shaw, and Select Equity Group 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 One Fin Capital Management allocated the biggest weight to Welbilt, Inc. (NYSE:WBT), around 4.6% of its 13F portfolio. Kent Lake Capital is also relatively very bullish on the stock, earmarking 3.73 percent of its 13F equity portfolio to WBT.

As aggregate interest increased, some big names have been driving this bullishness. Select Equity Group, managed by Robert Joseph Caruso, initiated the most valuable position in Welbilt, Inc. (NYSE:WBT). Select Equity Group had $16.9 million invested in the company at the end of the quarter. David MacKnight’s One Fin Capital Management also made a $9.9 million investment in the stock during the quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Welbilt, Inc. (NYSE:WBT) but similarly valued. These stocks are Air Transport Services Group Inc. (NASDAQ:ATSG), Academy Sports and Outdoors, Inc. (NASDAQ:ASO), Genmab A/S (NASDAQ:GMAB), Murphy Oil Corporation (NYSE:MUR), Fitbit Inc (NYSE:FIT), Addus Homecare Corporation (NASDAQ:ADUS), and Health Catalyst, Inc (NASDAQ:HCAT). This group of stocks’ market caps are closest to WBT’s market cap.

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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 $183 million. That figure was $361 million in WBT’s case. Fitbit Inc (NYSE:FIT) is the most popular stock in this table. On the other hand Air Transport Services Group Inc. (NASDAQ:ATSG) is the least popular one with only 16 bullish hedge fund positions. Welbilt, Inc. (NYSE:WBT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for WBT is 60.9. 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 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. Hedge funds were also right about betting on WBT as the stock returned 18.6% since the end of Q4 (through 4/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

Disclosure: None. This article was originally published at Insider Monkey.