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 WW International, Inc. (NASDAQ:WW).
Is WW stock a buy? WW International, Inc. (NASDAQ:WW) shareholders have witnessed an increase in enthusiasm from smart money of late. WW International, Inc. (NASDAQ:WW) was in 32 hedge funds’ portfolios at the end of December. The all time high for this statistic is 37. Our calculations also showed that WW isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Bill Miller of Miller Value Partners
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 let’s take a glance at the latest hedge fund action surrounding WW International, Inc. (NASDAQ:WW).
Do Hedge Funds Think WW Is A Good Stock To Buy Now?
At Q4’s end, a total of 32 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 19% from the previous quarter. The graph below displays the number of hedge funds with bullish position in WW over the last 22 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, Stadium Capital Management held the most valuable stake in WW International, Inc. (NASDAQ:WW), which was worth $73.3 million at the end of the fourth quarter. On the second spot was Miller Value Partners which amassed $63.8 million worth of shares. Sessa Capital, ThornTree Capital Partners, and Greenhouse Funds 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 Stadium Capital Management allocated the biggest weight to WW International, Inc. (NASDAQ:WW), around 36.56% of its 13F portfolio. ThornTree Capital Partners is also relatively very bullish on the stock, setting aside 4.94 percent of its 13F equity portfolio to WW.
There weren’t any hedge funds initiating brand new positions in the stock during the fourth quarter.
Let’s check out hedge fund activity in other stocks similar to WW International, Inc. (NASDAQ:WW). We will take a look at TechTarget Inc (NASDAQ:TTGT), Zuora, Inc. (NYSE:ZUO), Silicon Motion Technology Corp. (NASDAQ:SIMO), Eventbrite, Inc. (NYSE:EB), Sapiens International Corporation N.V. (NASDAQ:SPNS), Endo International plc (NASDAQ:ENDP), and Dicerna Pharmaceuticals Inc (NASDAQ:DRNA). This group of stocks’ market valuations are similar to WW’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TTGT | 18 | 124157 | 4 |
| ZUO | 22 | 178135 | -1 |
| SIMO | 18 | 294165 | 3 |
| EB | 26 | 352100 | 4 |
| SPNS | 14 | 63148 | 3 |
| ENDP | 13 | 420549 | -4 |
| DRNA | 29 | 287941 | -2 |
| Average | 20 | 245742 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $246 million. That figure was $379 million in WW’s case. Dicerna Pharmaceuticals Inc (NASDAQ:DRNA) is the most popular stock in this table. On the other hand Endo International plc (NASDAQ:ENDP) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks WW International, Inc. (NASDAQ:WW) is more popular among hedge funds. Our overall hedge fund sentiment score for WW is 85.9. 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 returned 12.2% in 2021 through April 12th but still managed to beat the market by 1.5 percentage points. Hedge funds were also right about betting on WW as the stock returned 20.8% since the end of December (through 4/12) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
