Was The Smart Money Right About Thryv Holdings, Inc. (THRY)?

In this article we will take a look at whether hedge funds think Thryv Holdings, Inc. (NASDAQ:THRY) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.

Thryv Holdings, Inc. (NASDAQ:THRY) has experienced an increase in hedge fund interest recently. Thryv Holdings, Inc. (NASDAQ:THRY) was in 15 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic was previously 12. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 12 hedge funds in our database with THRY holdings at the end of March. Our calculations also showed that THRY isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

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. Keeping this in mind let’s review the recent hedge fund action surrounding Thryv Holdings, Inc. (NASDAQ:THRY).

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

At Q2’s end, a total of 15 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in THRY over the last 24 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Mudrick Capital Management, managed by Jason Mudrick, holds the number one position in Thryv Holdings, Inc. (NASDAQ:THRY). Mudrick Capital Management has a $461.1 million position in the stock, comprising 50.6% of its 13F portfolio. Coming in second is GoldenTree Asset Management, managed by Steven Tananbaum, which holds a $123.7 million position; the fund has 3.3% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions comprise John Paulson’s Paulson & Co, Steven Ng and Andrew Mitchell’s Ophir Asset Management and Richard S. Meisenberg’s ACK Asset Management. In terms of the portfolio weights assigned to each position Mudrick Capital Management allocated the biggest weight to Thryv Holdings, Inc. (NASDAQ:THRY), around 50.63% of its 13F portfolio. Ophir Asset Management is also relatively very bullish on the stock, designating 7.02 percent of its 13F equity portfolio to THRY.

As one would reasonably expect, key money managers have jumped into Thryv Holdings, Inc. (NASDAQ:THRY) headfirst. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, initiated the biggest position in Thryv Holdings, Inc. (NASDAQ:THRY). Arrowstreet Capital had $2.7 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $2.4 million position during the quarter. The following funds were also among the new THRY investors: Ira Unschuld’s Brant Point Investment Management, Renaissance Technologies, and Thomas Bailard’s Bailard Inc.

Let’s check out hedge fund activity in other stocks similar to Thryv Holdings, Inc. (NASDAQ:THRY). We will take a look at The Lovesac Company (NASDAQ:LOVE), DermTech, Inc. (NASDAQ:DMTK), StoneX Group Inc. (NASDAQ:SNEX), CTS Corporation (NYSE:CTS), H&E Equipment Services, Inc. (NASDAQ:HEES), Loral Space & Communications Inc (NASDAQ:LORL), and Dril-Quip, Inc. (NYSE:DRQ). All of these stocks’ market caps resemble THRY’s market cap.

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As you can see these stocks had an average of 15.3 hedge funds with bullish positions and the average amount invested in these stocks was $157 million. That figure was $766 million in THRY’s case. StoneX Group Inc. (NASDAQ:SNEX) is the most popular stock in this table. On the other hand Dril-Quip, Inc. (NYSE:DRQ) is the least popular one with only 9 bullish hedge fund positions. Thryv Holdings, Inc. (NASDAQ:THRY) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for THRY is 65.3. 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 THRY wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); THRY investors were disappointed as the stock returned -13.2% 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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