Was The Smart Money Right About General Motors Company (GM)?

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 887 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 December 31st. In this article we look at what those investors think of General Motors Company (NYSE:GM).

General Motors Company (NYSE:GM) investors should be aware of an increase in support from the world’s most elite money managers lately. General Motors Company (NYSE:GM) was in 70 hedge funds’ portfolios at the end of December. The all time high for this statistic is 88. Our calculations also showed that GM isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

William Harnisch of Peconic Partners LLC

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, auto parts business is a recession resistant business, so we are taking a closer look at this discount auto parts stock that is growing at a 196% annualized rate. We go through lists like the 15 best micro-cap stocks to buy now to identify the next stock with 10x upside potential. 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 website. Keeping this in mind let’s analyze the latest hedge fund action encompassing General Motors Company (NYSE:GM).

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

At fourth quarter’s end, a total of 70 of the hedge funds tracked by Insider Monkey were long this stock, a change of 17% from the third quarter of 2020. Below, you can check out the change in hedge fund sentiment towards GM over the last 22 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Berkshire Hathaway, managed by Warren Buffett, holds the number one position in General Motors Company (NYSE:GM). Berkshire Hathaway has a $3.0189 billion position in the stock, comprising 1.1% of its 13F portfolio. On Berkshire Hathaway’s heels is Greenhaven Associates, led by Edgar Wachenheim, holding a $765.7 million position; 14.4% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors that are bullish consist of Boykin Curry’s Eagle Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Ric Dillon’s Diamond Hill Capital. In terms of the portfolio weights assigned to each position Greenhaven Associates allocated the biggest weight to General Motors Company (NYSE:GM), around 14.42% of its 13F portfolio. Pennant Capital Management is also relatively very bullish on the stock, dishing out 9.41 percent of its 13F equity portfolio to GM.

Consequently, some big names have been driving this bullishness. Renaissance Technologies, assembled the biggest position in General Motors Company (NYSE:GM). Renaissance Technologies had $68.3 million invested in the company at the end of the quarter. William Harnisch’s Peconic Partners LLC also initiated a $25.8 million position during the quarter. The other funds with brand new GM positions are Brandon Haley’s Holocene Advisors, Benjamin A. Smith’s Laurion Capital Management, and Paul Marshall and Ian Wace’s Marshall Wace LLP.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as General Motors Company (NYSE:GM) but similarly valued. These stocks are Marsh & McLennan Companies, Inc. (NYSE:MMC), VMware, Inc. (NYSE:VMW), Atlassian Corporation Plc (NASDAQ:TEAM), The Progressive Corporation (NYSE:PGR), Ferrari N.V. (NYSE:RACE), ABB Ltd (NYSE:ABB), and Workday Inc (NASDAQ:WDAY). All of these stocks’ market caps are closest to GM’s market cap.

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As you can see these stocks had an average of 44.6 hedge funds with bullish positions and the average amount invested in these stocks was $2181 million. That figure was $6333 million in GM’s case. Workday Inc (NASDAQ:WDAY) is the most popular stock in this table. On the other hand ABB Ltd (NYSE:ABB) is the least popular one with only 8 bullish hedge fund positions. General Motors Company (NYSE:GM) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GM is 76.9. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. Hedge funds were also right about betting on GM as the stock returned 39% since the end of Q4 (through 4/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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