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 have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider Peloton Interactive, Inc. (NASDAQ:PTON) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is Peloton Interactive, Inc. (NASDAQ:PTON) worth your attention right now? The best stock pickers were betting on the stock. The number of long hedge fund positions inched up by 1 recently. Peloton Interactive, Inc. (NASDAQ:PTON) was in 64 hedge funds’ portfolios at the end of March. The all time high for this statistic was previously 63. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that PTON isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
If you’d ask most market participants, hedge funds are viewed as slow, old investment vehicles of the past. While there are over 8000 funds with their doors open today, We hone in on the aristocrats of this club, about 850 funds. It is estimated that this group of investors oversee the majority of the smart money’s total capital, and by tailing their inimitable picks, Insider Monkey has unearthed a few investment strategies that have historically outrun the broader indices. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. 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 .
Alex Sacerdote of Whale Rock Capital Management
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Do Hedge Funds Think PTON Is A Good Stock To Buy Now?
At first quarter’s end, a total of 64 of the hedge funds tracked by Insider Monkey were long this stock, a change of 2% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards PTON over the last 23 quarters. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
Among these funds, Tiger Global Management LLC held the most valuable stake in Peloton Interactive, Inc. (NASDAQ:PTON), which was worth $883.5 million at the end of the fourth quarter. On the second spot was Whale Rock Capital Management which amassed $387.4 million worth of shares. Citadel Investment Group, Renaissance Technologies, and D1 Capital Partners were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Woodson Capital Management allocated the biggest weight to Peloton Interactive, Inc. (NASDAQ:PTON), around 15.67% of its 13F portfolio. Woodson Capital Management is also relatively very bullish on the stock, setting aside 12.95 percent of its 13F equity portfolio to PTON.
Consequently, some big names have been driving this bullishness. D1 Capital Partners, managed by Daniel Sundheim, assembled the largest position in Peloton Interactive, Inc. (NASDAQ:PTON). D1 Capital Partners had $229.8 million invested in the company at the end of the quarter. Eashwar Krishnan’s Tybourne Capital Management also initiated a $134.2 million position during the quarter. The other funds with brand new PTON positions are Brad Gerstner’s Altimeter Capital Management, David Fiszel’s Honeycomb Asset Management, and Robert Pohly’s Samlyn Capital.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Peloton Interactive, Inc. (NASDAQ:PTON) but similarly valued. These stocks are Marvell Technology, Inc. (NASDAQ:MRVL), Orange SA (NYSE:ORAN), The Hershey Company (NYSE:HSY), Wayfair Inc (NYSE:W), Yum! Brands, Inc. (NYSE:YUM), Stanley Black & Decker, Inc. (NYSE:SWK), and D.R. Horton, Inc. (NYSE:DHI). This group of stocks’ market values resemble PTON’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MRVL | 33 | 683159 | -7 |
| ORAN | 2 | 10613 | -1 |
| HSY | 42 | 1267940 | 3 |
| W | 37 | 4012752 | -3 |
| YUM | 32 | 751481 | -1 |
| SWK | 33 | 993045 | -5 |
| DHI | 50 | 2174422 | -14 |
| Average | 32.7 | 1413345 | -4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 32.7 hedge funds with bullish positions and the average amount invested in these stocks was $1413 million. That figure was $3963 million in PTON’s case. D.R. Horton, Inc. (NYSE:DHI) is the most popular stock in this table. On the other hand Orange SA (NYSE:ORAN) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Peloton Interactive, Inc. (NASDAQ:PTON) is more popular among hedge funds. Our overall hedge fund sentiment score for PTON is 86. 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 PTON wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on PTON were disappointed as the stock returned 0.2% 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 Peloton Interactive Inc. (NASDAQ:PTON)
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Disclosure: None. This article was originally published at Insider Monkey.
