Was The Smart Money Right About ANGI Homeservices Inc (ANGI)?

Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about ANGI Homeservices Inc (NASDAQ:ANGI) in this article.

ANGI Homeservices Inc (NASDAQ:ANGI) was in 26 hedge funds’ portfolios at the end of June. The all time high for this statistic is 48. ANGI shareholders have witnessed a decrease in activity from the world’s largest hedge funds in recent months. There were 35 hedge funds in our database with ANGI holdings at the end of March. Our calculations also showed that ANGI isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Steven Cohen of Point72 Asset Management

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 are checking out stock pitches like this emerging lithium stock. 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. With all of this in mind let’s take a look at the latest hedge fund action encompassing ANGI Homeservices Inc (NASDAQ:ANGI).

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

At Q2’s end, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -26% from the previous quarter. By comparison, 48 hedge funds held shares or bullish call options in ANGI a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, ShawSpring Partners, managed by Dennis Hong, holds the most valuable position in ANGI Homeservices Inc (NASDAQ:ANGI). ShawSpring Partners has a $54.3 million position in the stock, comprising 5.2% of its 13F portfolio. On ShawSpring Partners’s heels is Point72 Asset Management, managed by Steve Cohen, which holds a $46.5 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining hedge funds and institutional investors that are bullish contain Joshua Nash’s Ulysses Management, Ari Zweiman’s 683 Capital Partners and Robert M. P. Luciano’s VGI Partners. In terms of the portfolio weights assigned to each position Provenire Capital allocated the biggest weight to ANGI Homeservices Inc (NASDAQ:ANGI), around 5.36% of its 13F portfolio. ShawSpring Partners is also relatively very bullish on the stock, dishing out 5.16 percent of its 13F equity portfolio to ANGI.

Judging by the fact that ANGI Homeservices Inc (NASDAQ:ANGI) has experienced declining sentiment from hedge fund managers, we can see that there exists a select few hedgies that elected to cut their positions entirely heading into Q3. Intriguingly, Sander Gerber’s Hudson Bay Capital Management cut the biggest stake of the “upper crust” of funds monitored by Insider Monkey, worth close to $5.7 million in stock, and Richard SchimeláandáLawrence Sapanski’s Cinctive Capital Management was right behind this move, as the fund sold off about $2.2 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 9 funds heading into Q3.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as ANGI Homeservices Inc (NASDAQ:ANGI) but similarly valued. We will take a look at Stifel Financial Corp. (NYSE:SF), Marriott Vacations Worldwide Corporation (NYSE:VAC), Brixmor Property Group Inc (NYSE:BRX), VCA Antech Inc (NASDAQ:WOOF), Wyndham Hotels & Resorts, Inc. (NYSE:WH), First Industrial Realty Trust, Inc. (NYSE:FR), and InVitae Corporation (NYSE:NVTA). All of these stocks’ market caps are similar to ANGI’s market cap.

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As you can see these stocks had an average of 26.3 hedge funds with bullish positions and the average amount invested in these stocks was $700 million. That figure was $314 million in ANGI’s case. Marriott Vacations Worldwide Corporation (NYSE:VAC) is the most popular stock in this table. On the other hand Brixmor Property Group Inc (NYSE:BRX) is the least popular one with only 21 bullish hedge fund positions. ANGI Homeservices Inc (NASDAQ:ANGI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ANGI is 30.1. 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 29.6% in 2021 through November 5th and surpassed the market again by 3.1 percentage points. Unfortunately ANGI wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); ANGI investors were disappointed as the stock returned -19.6% since the end of June (through 11/5) 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.

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