Where Do Hedge Funds Stand On Delta Air Lines, Inc. (DAL)?

Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of June. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Delta Air Lines, Inc. (NYSE:DAL), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Delta Air Lines, Inc. (NYSE:DAL) investors should be aware of a decrease in hedge fund sentiment of late. Delta Air Lines, Inc. (NYSE:DAL) was in 49 hedge funds’ portfolios at the end of June. The all time high for this statistic is 109. Our calculations also showed that DAL isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

In today’s marketplace there are several gauges shareholders have at their disposal to grade stocks. Two of the less known gauges are hedge fund and insider trading signals. We have shown that, historically, those who follow the top picks of the best hedge fund managers can outperform the market by a superb margin (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website .

Paul Reeder of PAR Capital Management

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 we’re going to take a peek at the latest hedge fund action encompassing Delta Air Lines, Inc. (NYSE:DAL).

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

Heading into the third quarter of 2021, a total of 49 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -2% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards DAL over the last 24 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Citadel Investment Group was the largest shareholder of Delta Air Lines, Inc. (NYSE:DAL), with a stake worth $202.4 million reported as of the end of June. Trailing Citadel Investment Group was Lansdowne Partners, which amassed a stake valued at $198.5 million. PAR Capital Management, D E Shaw, and GLG 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 Lansdowne Partners allocated the biggest weight to Delta Air Lines, Inc. (NYSE:DAL), around 7.93% of its 13F portfolio. PAR Capital Management is also relatively very bullish on the stock, earmarking 3.48 percent of its 13F equity portfolio to DAL.

Because Delta Air Lines, Inc. (NYSE:DAL) has witnessed bearish sentiment from hedge fund managers, we can see that there was a specific group of hedgies who were dropping their full holdings last quarter. It’s worth mentioning that Robert Henry Lynch’s Aristeia Capital cut the largest investment of all the hedgies followed by Insider Monkey, totaling about $49.1 million in stock. Jack Woodruff’s fund, Candlestick Capital Management, also dropped its stock, about $6.6 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 1 funds last quarter.

Let’s check out hedge fund activity in other stocks similar to Delta Air Lines, Inc. (NYSE:DAL). We will take a look at Arista Networks Inc (NYSE:ANET), Eversource Energy (NYSE:ES), Interactive Brokers Group, Inc. (NASDAQ:IBKR), HubSpot Inc (NYSE:HUBS), Coca-Cola Europacific Partners plc (NASDAQ:CCEP), Deutsche Bank Aktiengesellschaft (NYSE:DB), and Laboratory Corp. of America Holdings (NYSE:LH). This group of stocks’ market valuations match DAL’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 36.4 hedge funds with bullish positions and the average amount invested in these stocks was $1512 million. That figure was $1218 million in DAL’s case. HubSpot Inc (NYSE:HUBS) is the most popular stock in this table. On the other hand Deutsche Bank Aktiengesellschaft (NYSE:DB) is the least popular one with only 20 bullish hedge fund positions. Delta Air Lines, Inc. (NYSE:DAL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for DAL is 60.1. 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 22.9% in 2021 through October 1st and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on DAL as the stock returned 4.9% since the end of Q2 (through 10/1) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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Disclosure: None. This article was originally published at Insider Monkey.