Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Wheaton Precious Metals Corp. (NYSE:WPM).
Is Wheaton Precious Metals Corp. (NYSE:WPM) a healthy stock for your portfolio? The smart money was turning bullish. The number of long hedge fund positions inched up by 1 in recent months. Wheaton Precious Metals Corp. (NYSE:WPM) was in 27 hedge funds’ portfolios at the end of September. The all time high for this statistic is 34. Our calculations also showed that WPM isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 26 hedge funds in our database with WPM positions at the end of the second quarter.
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 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. Now we’re going to take a glance at the fresh hedge fund action regarding Wheaton Precious Metals Corp. (NYSE:WPM).
Eric Sprott of Sprott Asset Management
Do Hedge Funds Think WPM Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 27 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 4% from the previous quarter. By comparison, 29 hedge funds held shares or bullish call options in WPM a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).
Among these funds, Horizon Asset Management held the most valuable stake in Wheaton Precious Metals Corp. (NYSE:WPM), which was worth $112.8 million at the end of the third quarter. On the second spot was Renaissance Technologies which amassed $61.8 million worth of shares. Sprott Asset Management, Orbis Investment Management, and Citadel Investment Group 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 Moerus Capital Management allocated the biggest weight to Wheaton Precious Metals Corp. (NYSE:WPM), around 6.64% of its 13F portfolio. Sprott Asset Management is also relatively very bullish on the stock, setting aside 3.21 percent of its 13F equity portfolio to WPM.
As industrywide interest jumped, key hedge funds were breaking ground themselves. Gotham Asset Management, managed by Joel Greenblatt, created the biggest position in Wheaton Precious Metals Corp. (NYSE:WPM). Gotham Asset Management had $1.2 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also made a $0.8 million investment in the stock during the quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Wheaton Precious Metals Corp. (NYSE:WPM) but similarly valued. These stocks are Boston Properties, Inc. (NYSE:BXP), ASE Technology Holding Co., Ltd. (NYSE:ASX), The Carlyle Group Inc (NASDAQ:CG), Ceridian HCM Holding Inc. (NYSE:CDAY), Celanese Corporation (NYSE:CE), Bath & Body Works Inc. (NYSE:BBWI), and Full Truck Alliance Co. Ltd. (NYSE:YMM). This group of stocks’ market values resemble WPM’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BXP | 21 | 1471101 | 2 |
| ASX | 10 | 271536 | 3 |
| CG | 34 | 1401572 | 13 |
| CDAY | 20 | 1798355 | -5 |
| CE | 26 | 735190 | -11 |
| BBWI | 56 | 6556642 | 3 |
| YMM | 13 | 263866 | -7 |
| Average | 25.7 | 1785466 | -0.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.7 hedge funds with bullish positions and the average amount invested in these stocks was $1785 million. That figure was $348 million in WPM’s case. Bath & Body Works Inc. (NYSE:BBWI) is the most popular stock in this table. On the other hand ASE Technology Holding Co., Ltd. (NYSE:ASX) is the least popular one with only 10 bullish hedge fund positions. Wheaton Precious Metals Corp. (NYSE:WPM) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for WPM is 48.3. 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. Hedge funds were also right about betting on WPM as the stock returned 8.8% since the end of Q3 (through 12/9) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Wheaton Precious Metals Corp. (NYSE:WPM)
Follow Wheaton Precious Metals Corp. (NYSE:WPM)
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Disclosure: None. This article was originally published at Insider Monkey.
