After several tireless days we have finished crunching the numbers from the more than 700 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 September 30. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards NXP Semiconductors NV (NASDAQ:NXPI).
Is NXP Semiconductors NV (NASDAQ:NXPI) going to take off soon? Hedge funds are becoming less confident. The number of long hedge fund positions were trimmed by 10 in recent months. NXPI was in 59 hedge funds’ portfolios at the end of September. There were 69 hedge funds in our database with NXPI holdings at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as The Hershey Company (NYSE:HSY), United Continental Holdings Inc (NYSE:UAL), and Brown-Forman Corporation (NYSE:BF) to gather more data points.
Follow Nxp Semiconductors N.v. (NASDAQ:NXPI)
Follow Nxp Semiconductors N.v. (NASDAQ:NXPI)
According to most shareholders, hedge funds are assumed to be slow, old investment vehicles of years past. While there are more than 8000 funds trading at the moment, We hone in on the upper echelon of this group, about 700 funds. These investment experts shepherd the majority of the hedge fund industry’s total asset base, and by tracking their best stock picks, Insider Monkey has brought to light several investment strategies that have historically defeated the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 12 percentage points per annum for a decade in their back tests.
Keeping this in mind, let’s go over the latest action regarding NXP Semiconductors NV (NASDAQ:NXPI).
What does the smart money think about NXP Semiconductors NV (NASDAQ:NXPI)?
Heading into Q4, a total of 59 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -14% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Eric W. Mandelblatt’s Soroban Capital Partners has the number one position in NXP Semiconductors NV (NASDAQ:NXPI), worth close to $439.3 million, corresponding to 3.2% of its total 13F portfolio. The second largest stake is held by Ken Griffin of Citadel Investment Group, with a $419.8 million position; 0.4% of its 13F portfolio is allocated to the stock. Remaining professional money managers that hold long positions contain James Dinan’s York Capital Management, David Tepper’s Appaloosa Management LP and Clifford Fox’s Columbus Circle Investors.
Seeing as NXP Semiconductors NV (NASDAQ:NXPI) has faced falling interest from the smart money, logic holds that there is a sect of hedgies who were dropping their positions entirely heading into Q4. At the top of the heap, Andreas Halvorsen’s Viking Global dumped the biggest position of the 700 funds followed by Insider Monkey, totaling an estimated $139.3 million in stock, and Aaron Cowen’s Suvretta Capital Management was right behind this move, as the fund cut about $80.5 million worth. These moves are interesting, as aggregate hedge fund interest was cut by 10 funds heading into Q4.
Let’s check out hedge fund activity in other stocks similar to NXP Semiconductors NV (NASDAQ:NXPI). These stocks are The Hershey Company (NYSE:HSY), United Continental Holdings Inc (NYSE:UAL), Brown-Forman Corporation (NYSE:BF), and Incyte Corporation (NASDAQ:INCY). All of these stocks’ market caps match NXPI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HSY | 18 | 456777 | -6 |
| UAL | 70 | 2974145 | -2 |
| BF | 23 | 621353 | 3 |
| INCY | 40 | 3233575 | 5 |
As you can see these stocks had an average of 37.75 hedge funds with bullish positions and the average amount invested in these stocks was $1,821 million. That figure was $3,189 million in NXPI’s case. United Continental Holdings Inc (NYSE:UAL) is the most popular stock in this table. On the other hand The Hershey Company (NYSE:HSY) is the least popular one with only 18 bullish hedge fund positions. NXP Semiconductors NV (NASDAQ:NXPI) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard UAL might be a better candidate to consider a long position.
