Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of TotalEnergies SE (NYSE:TTE).
Is TotalEnergies SE (NYSE:TTE) a great investment today? The best stock pickers were taking a bearish view. The number of long hedge fund bets retreated by 2 in recent months. TotalEnergies SE (NYSE:TTE) was in 15 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 19. Our calculations also showed that TTE 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. With all of this in mind let’s take a look at the latest hedge fund action encompassing TotalEnergies SE (NYSE:TTE).
Do Hedge Funds Think TTE Is A Good Stock To Buy Now?
At second quarter’s end, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of -12% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards TTE over the last 24 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in TotalEnergies SE (NYSE:TTE) was held by Fisher Asset Management, which reported holding $1048.7 million worth of stock at the end of June. It was followed by Paulson & Co with a $43.3 million position. Other investors bullish on the company included Citadel Investment Group, Soros Fund Management, and Solus Alternative Asset Management. In terms of the portfolio weights assigned to each position Solus Alternative Asset Management allocated the biggest weight to TotalEnergies SE (NYSE:TTE), around 1.72% of its 13F portfolio. Paulson & Co is also relatively very bullish on the stock, dishing out 1.03 percent of its 13F equity portfolio to TTE.
Due to the fact that TotalEnergies SE (NYSE:TTE) has witnessed declining sentiment from hedge fund managers, we can see that there were a few money managers that slashed their entire stakes heading into Q3. Interestingly, Dmitry Balyasny’s Balyasny Asset Management dumped the biggest position of all the hedgies followed by Insider Monkey, totaling about $6.2 million in stock. Anand Parekh’s fund, Alyeska Investment Group, also sold off its stock, about $6 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 2 funds heading into Q3.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as TotalEnergies SE (NYSE:TTE) but similarly valued. These stocks are General Electric Company (NYSE:GE), HSBC Holdings plc (NYSE:HSBC), Vale SA (NYSE:VALE), The Estee Lauder Companies Inc (NYSE:EL), 3M Company (NYSE:MMM), Advanced Micro Devices, Inc. (NASDAQ:AMD), and Zoom Video Communications, Inc. (NASDAQ:ZM). All of these stocks’ market caps match TTE’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GE | 67 | 6087180 | -1 |
| HSBC | 11 | 212763 | -1 |
| VALE | 27 | 3573958 | -4 |
| EL | 50 | 4129744 | -9 |
| MMM | 42 | 1582540 | 1 |
| AMD | 63 | 4610011 | 1 |
| ZM | 59 | 8480712 | 5 |
| Average | 45.6 | 4096701 | -1.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 45.6 hedge funds with bullish positions and the average amount invested in these stocks was $4097 million. That figure was $1132 million in TTE’s case. General Electric Company (NYSE:GE) is the most popular stock in this table. On the other hand HSBC Holdings plc (NYSE:HSBC) is the least popular one with only 11 bullish hedge fund positions. TotalEnergies SE (NYSE:TTE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TTE is 30.3. 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. 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 still beat the market by 3.1 percentage points. A small number of hedge funds were also right about betting on TTE as the stock returned 12.4% since the end of the second quarter (through 11/5) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
