We at Insider Monkey have gone over 866 13F filings that hedge funds and prominent investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article, we look at what those funds think of Baidu, Inc. (NASDAQ:BIDU) based on that data.
Is Baidu, Inc. (NASDAQ:BIDU) a buy right now? Prominent investors were betting on the stock. The number of long hedge fund bets rose by 38 recently. Baidu, Inc. (NASDAQ:BIDU) was in 89 hedge funds’ portfolios at the end of March. The all time high for this statistic was previously 72. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that BIDU isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 51 hedge funds in our database with BIDU positions at the end of the fourth quarter.
In today’s marketplace there are plenty of methods stock traders can use to analyze publicly traded companies. A pair of the most underrated methods are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the top picks of the top hedge fund managers can outpace the market by a significant margin (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .
John Rogers of Ariel Investments
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, 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 take a look at the latest hedge fund action surrounding Baidu, Inc. (NASDAQ:BIDU).
Do Hedge Funds Think BIDU Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 89 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 75% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards BIDU over the last 23 quarters. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
The largest stake in Baidu, Inc. (NASDAQ:BIDU) was held by ARK Investment Management, which reported holding $1115.5 million worth of stock at the end of December. It was followed by Renaissance Technologies with a $697.2 million position. Other investors bullish on the company included D E Shaw, Citadel Investment Group, and Ariel Investments. In terms of the portfolio weights assigned to each position Kayak Investment Partners allocated the biggest weight to Baidu, Inc. (NASDAQ:BIDU), around 8.96% of its 13F portfolio. Keywise Capital Management is also relatively very bullish on the stock, dishing out 8.66 percent of its 13F equity portfolio to BIDU.
As one would reasonably expect, specific money managers have jumped into Baidu, Inc. (NASDAQ:BIDU) headfirst. D E Shaw, managed by D. E. Shaw, established the largest position in Baidu, Inc. (NASDAQ:BIDU). D E Shaw had $626.9 million invested in the company at the end of the quarter. Benjamin A. Smith’s Laurion Capital Management also made a $231.6 million investment in the stock during the quarter. The other funds with brand new BIDU positions are Chris Rokos’s Rokos Capital Management, Karthik Sarma’s SRS Investment Management, and Josh Resnick’s Jericho Capital Asset Management.
Let’s also examine hedge fund activity in other stocks similar to Baidu, Inc. (NASDAQ:BIDU). We will take a look at Activision Blizzard, Inc. (NASDAQ:ATVI), ConocoPhillips (NYSE:COP), NetEase, Inc (NASDAQ:NTES), Chubb Limited (NYSE:CB), Becton, Dickinson and Company (NYSE:BDX), Illinois Tool Works Inc. (NYSE:ITW), and Norfolk Southern Corp. (NYSE:NSC). This group of stocks’ market caps are closest to BIDU’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ATVI | 76 | 3580901 | -5 |
| COP | 51 | 1205455 | 2 |
| NTES | 32 | 3501491 | -6 |
| CB | 41 | 1605208 | 7 |
| BDX | 65 | 3732947 | 0 |
| ITW | 33 | 411615 | -7 |
| NSC | 46 | 898621 | 2 |
| Average | 49.1 | 2133748 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 49.1 hedge funds with bullish positions and the average amount invested in these stocks was $2134 million. That figure was $6572 million in BIDU’s case. Activision Blizzard, Inc. (NASDAQ:ATVI) is the most popular stock in this table. On the other hand NetEase, Inc (NASDAQ:NTES) is the least popular one with only 32 bullish hedge fund positions. Compared to these stocks Baidu, Inc. (NASDAQ:BIDU) is more popular among hedge funds. Our overall hedge fund sentiment score for BIDU is 90. 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 25.8% in 2021 through August 6th and still beat the market by 6.7 percentage points. Unfortunately BIDU wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on BIDU were disappointed as the stock returned -24.5% since the end of the first quarter (through 8/6) 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 since 2019.
Follow Baidu Inc (NASDAQ:BIDU)
Follow Baidu Inc (NASDAQ:BIDU)
Suggested Articles:
- 10 Best Junior Gold Mining Stocks To Buy
- 10 Best Stocks to Buy for Financial Independence
- 15 Most Dangerous Cities in Europe
Disclosure: None. This article was originally published at Insider Monkey.
