Was The Smart Money Right About Advanced Micro Devices, Inc. (AMD)?

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 at Insider Monkey have plowed through 873 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of June 30th. In this article we look at what those investors think of Advanced Micro Devices, Inc. (NASDAQ:AMD).

Advanced Micro Devices, Inc. (NASDAQ:AMD) investors should pay attention to an increase in support from the world’s most elite money managers lately. Advanced Micro Devices, Inc. (NASDAQ:AMD) was in 63 hedge funds’ portfolios at the end of June. The all time high for this statistic is 74. There were 62 hedge funds in our database with AMD positions at the end of the first quarter. Our calculations also showed that AMD isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

At the moment there are many gauges investors use to assess their stock investments. A duo of the most innovative gauges are hedge fund and insider trading activity. Our experts have shown that, historically, those who follow the top picks of the elite fund managers can trounce the market by a healthy amount (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. We check out articles like Warren Buffett’s 3 money saving tips that provide inflation and volatility hedges. 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. 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 check out the new hedge fund action regarding Advanced Micro Devices, Inc. (NASDAQ:AMD).

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

At the end of June, a total of 63 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 2% from the first quarter of 2020. On the other hand, there were a total of 51 hedge funds with a bullish position in AMD a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the largest position in Advanced Micro Devices, Inc. (NASDAQ:AMD). Citadel Investment Group has a $1.6468 billion call position in the stock, comprising 0.4% of its 13F portfolio. Coming in second is Fisher Asset Management, managed by Ken Fisher, which holds a $941.3 million position; 0.6% of its 13F portfolio is allocated to the stock. Some other members of the smart money that are bullish consist of D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Daniel Patrick Gibson’s Sylebra Capital Management. In terms of the portfolio weights assigned to each position Tairen Capital allocated the biggest weight to Advanced Micro Devices, Inc. (NASDAQ:AMD), around 17.96% of its 13F portfolio. Sylebra Capital Management is also relatively very bullish on the stock, setting aside 10.42 percent of its 13F equity portfolio to AMD.

With a general bullishness amongst the heavyweights, some big names have been driving this bullishness. Jericho Capital Asset Management, managed by Josh Resnick, established the most outsized position in Advanced Micro Devices, Inc. (NASDAQ:AMD). Jericho Capital Asset Management had $196.4 million invested in the company at the end of the quarter. Larry Chen and Terry Zhang’s Tairen Capital also initiated a $102.6 million position during the quarter. The other funds with brand new AMD positions are D. E. Shaw’s D E Shaw, David Fiszel’s Honeycomb Asset Management, and Mark Kingdon’s Kingdon Capital.

Let’s now review hedge fund activity in other stocks similar to Advanced Micro Devices, Inc. (NASDAQ:AMD). These stocks are Zoom Video Communications, Inc. (NASDAQ:ZM), Diageo plc (NYSE:DEO), Square, Inc. (NYSE:SQ), Deere & Company (NYSE:DE), CVS Health Corporation (NYSE:CVS), Intuitive Surgical, Inc. (NASDAQ:ISRG), and ServiceNow Inc (NYSE:NOW). This group of stocks’ market caps resemble AMD’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 63.3 hedge funds with bullish positions and the average amount invested in these stocks was $4817 million. That figure was $4610 million in AMD’s case. Square, Inc. (NYSE:SQ) is the most popular stock in this table. On the other hand Diageo plc (NYSE:DEO) is the least popular one with only 20 bullish hedge fund positions. Advanced Micro Devices, Inc. (NASDAQ:AMD) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for AMD is 60.6. 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 26.3% in 2021 through October 29th and still beat the market by 2.3 percentage points. A small number of hedge funds were also right about betting on AMD as the stock returned 28% since the end of the second quarter (through 10/29) and outperformed the market by an even larger margin.

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

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