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 March 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 X Financial (NYSE:XYF).
Is XYF stock a buy? Hedge funds were turning bullish. The number of bullish hedge fund positions inched up by 1 lately. X Financial (NYSE:XYF) was in 4 hedge funds’ portfolios at the end of March. The all time high for this statistic is 4. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that XYF isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 3 hedge funds in our database with XYF holdings at the end of December.
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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. 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 115 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
Richard Gerson of Falcon Edge Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $27 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery 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. 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 homepage. Now let’s take a gander at the fresh hedge fund action surrounding X Financial (NYSE:XYF).
Do Hedge Funds Think XYF Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 4 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 33% from the previous quarter. On the other hand, there were a total of 2 hedge funds with a bullish position in XYF a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, AWH Capital, managed by Austin Wiggins Hopper, holds the most valuable position in X Financial (NYSE:XYF). AWH Capital has a $1.1 million position in the stock, comprising 1.1% of its 13F portfolio. On AWH Capital’s heels is Renaissance Technologies, which holds a $0.7 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions include Richard Gerson and Navroz D. Udwadia’s Falcon Edge Capital, Ken Griffin’s Citadel Investment Group and . In terms of the portfolio weights assigned to each position 0 allocated the biggest weight to X Financial (NYSE:XYF), around 1.12% of its 13F portfolio. 0 is also relatively very bullish on the stock, setting aside 0.02 percent of its 13F equity portfolio to XYF.
With a general bullishness amongst the heavyweights, key hedge funds have jumped into X Financial (NYSE:XYF) headfirst. Citadel Investment Group, managed by Ken Griffin, assembled the biggest position in X Financial (NYSE:XYF). Citadel Investment Group had $0.1 million invested in the company at the end of the quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as X Financial (NYSE:XYF) but similarly valued. These stocks are Atlantic Power Corp (NYSE:AT), Ciner Resources LP (NYSE:CINR), RedHill Biopharma Ltd (NASDAQ:RDHL), Ondas Holdings Inc. (NASDAQ:ONDS), AGM Group Holdings Inc. (NASDAQ:AGMH), PARTS iD, Inc. (NYSE:ID), and Gran Tierra Energy Inc. (NYSE:GTE). This group of stocks’ market valuations are closest to XYF’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AT | 21 | 35743 | 11 |
| CINR | 1 | 2313 | 0 |
| RDHL | 4 | 18799 | 1 |
| ONDS | 5 | 2690 | 2 |
| AGMH | 1 | 144 | 0 |
| ID | 6 | 8061 | 2 |
| GTE | 6 | 36649 | -2 |
| Average | 6.3 | 14914 | 2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.3 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $2 million in XYF’s case. Atlantic Power Corp (NYSE:AT) is the most popular stock in this table. On the other hand Ciner Resources LP (NYSE:CINR) is the least popular one with only 1 bullish hedge fund positions. X Financial (NYSE:XYF) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for XYF is 43.5. 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 17.2% in 2021 through June 11th and still beat the market by 3.3 percentage points. A small number of hedge funds were also right about betting on XYF as the stock returned 89.8% since the end of the first quarter (through 6/11) and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.