At Insider Monkey, we pore over the filings of nearly 867 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of September 30th. In this article, we will use that wealth of knowledge to determine whether or not ReNew Energy Global plc (NASDAQ:RNW) makes for a good investment right now.
Is ReNew Energy Global plc (NASDAQ:RNW) a sound investment right now? Hedge funds were taking a bullish view. The number of bullish hedge fund bets advanced by 24 recently. ReNew Energy Global plc (NASDAQ:RNW) was in 24 hedge funds’ portfolios at the end of September. Our calculations also showed that RNW isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Stuart Zimmer of Zimmer Partners
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV 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. With all of this in mind let’s analyze the recent hedge fund action encompassing ReNew Energy Global plc (NASDAQ:RNW).
Do Hedge Funds Think RNW Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 24 from the previous quarter. By comparison, 0 hedge funds held shares or bullish call options in RNW a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Sylebra Capital Management, managed by Daniel Patrick Gibson, holds the number one position in ReNew Energy Global plc (NASDAQ:RNW) . Sylebra Capital Management has a $56.6 million position in the stock, comprising 1.3% of its 13F portfolio. Sitting at the No. 2 spot is Stuart J. Zimmer of Zimmer Partners, with a $30.7 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions contain Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group and Phill Gross and Robert Atchinson’s Adage Capital Management. In terms of the portfolio weights assigned to each position Alta Fundamental Advisers allocated the biggest weight to ReNew Energy Global plc (NASDAQ:RNW) , around 2.93% of its 13F portfolio. Thunderbird Partners is also relatively very bullish on the stock, designating 2.02 percent of its 13F equity portfolio to RNW.
As one would reasonably expect, key money managers were breaking ground themselves. Sylebra Capital Management, managed by Daniel Patrick Gibson, assembled the biggest position in ReNew Energy Global plc (NASDAQ:RNW) . Sylebra Capital Management had $56.6 million invested in the company at the end of the quarter. Stuart J. Zimmer’s Zimmer Partners also made a $30.7 million investment in the stock during the quarter. The following funds were also among the new RNW investors: Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group, and Phill Gross and Robert Atchinson’s Adage Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to ReNew Energy Global plc (NASDAQ:RNW) . These stocks are Diodes Incorporated (NASDAQ:DIOD), Univar Solutions Inc (NYSE:UNVR), Sonos, Inc. (NASDAQ:SONO), Spectrum Brands Holdings, Inc. (NYSE:SPB), Safehold Inc. (NYSE:SAFE), Vonage Holdings Corp. (NYSE:VG), and BRF SA (NYSE:BRFS). This group of stocks’ market caps resemble RNW’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DIOD | 19 | 116182 | 1 |
| UNVR | 29 | 676496 | 1 |
| SONO | 49 | 647491 | 2 |
| SPB | 30 | 642268 | -5 |
| SAFE | 18 | 65725 | 12 |
| VG | 29 | 843024 | 0 |
| BRFS | 6 | 8102 | 0 |
| Average | 25.7 | 428470 | 1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.7 hedge funds with bullish positions and the average amount invested in these stocks was $428 million. That figure was $287 million in RNW’s case. Sonos, Inc. (NASDAQ:SONO) is the most popular stock in this table. On the other hand BRF SA (NYSE:BRFS) is the least popular one with only 6 bullish hedge fund positions. ReNew Energy Global plc (NASDAQ:RNW) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for RNW 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. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. 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 31.1% in 2021 through December 9th and surpassed the market again by 5.1 percentage points. Unfortunately RNW wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); RNW investors were disappointed as the stock returned -17.5% since the end of September (through 12/9) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.
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Disclosure: None. This article was originally published at Insider Monkey.