Where Do Hedge Funds Stand On Ryman Hospitality Properties, Inc. (RHP)?

Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industry and media insiders on top of that. Individual investors can piggyback the hedge funds employing these talents and can benefit from their vast resources and knowledge in that way. We analyze quarterly 13F filings of nearly 900 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has the potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about Ryman Hospitality Properties, Inc. (NYSE:RHP).

Ryman Hospitality Properties, Inc. (NYSE:RHP) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 22 hedge funds’ portfolios at the end of June. Our calculations also showed that RHP isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Certara, Inc. (NASDAQ:CERT), Advanced Energy Industries, Inc. (NASDAQ:AEIS), and Resideo Technologies, Inc. (NYSE:REZI) to gather more data points.

If you’d ask most investors, hedge funds are assumed to be worthless, old investment vehicles of yesteryear. While there are greater than 8000 funds in operation at the moment, Our researchers look at the crème de la crème of this group, about 850 funds. These money managers oversee bulk of all hedge funds’ total capital, and by paying attention to their best picks, Insider Monkey has identified a number of investment strategies that have historically outrun the broader indices. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. 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.

Frank Brosens of Taconic Capital

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 gander at the recent hedge fund action encompassing Ryman Hospitality Properties, Inc. (NYSE:RHP).

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

At second quarter’s end, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the first quarter of 2020. The graph below displays the number of hedge funds with bullish position in RHP over the last 24 quarters. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).

More specifically, GAMCO Investors was the largest shareholder of Ryman Hospitality Properties, Inc. (NYSE:RHP), with a stake worth $114.8 million reported as of the end of June. Trailing GAMCO Investors was Citadel Investment Group, which amassed a stake valued at $50.3 million. Scopus Asset Management, Millennium Management, and Capital Growth Management 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 Sonic Capital allocated the biggest weight to Ryman Hospitality Properties, Inc. (NYSE:RHP), around 3.6% of its 13F portfolio. Capital Growth Management is also relatively very bullish on the stock, designating 1.92 percent of its 13F equity portfolio to RHP.

Seeing as Ryman Hospitality Properties, Inc. (NYSE:RHP) has witnessed a decline in interest from the aggregate hedge fund industry, we can see that there is a sect of money managers that decided to sell off their full holdings in the second quarter. Intriguingly, Ricky Sandler’s Eminence Capital said goodbye to the biggest position of the 750 funds watched by Insider Monkey, comprising close to $50.2 million in stock, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital was right behind this move, as the fund said goodbye to about $3.3 million worth. These moves are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Ryman Hospitality Properties, Inc. (NYSE:RHP) but similarly valued. We will take a look at Certara, Inc. (NASDAQ:CERT), Advanced Energy Industries, Inc. (NASDAQ:AEIS), Resideo Technologies, Inc. (NYSE:REZI), Wintrust Financial Corporation (NASDAQ:WTFC), Healthcare Realty Trust Inc (NYSE:HR), New Relic Inc (NYSE:NEWR), and frontdoor, inc. (NASDAQ:FTDR). This group of stocks’ market valuations are closest to RHP’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 21.6 hedge funds with bullish positions and the average amount invested in these stocks was $466 million. That figure was $342 million in RHP’s case. frontdoor, inc. (NASDAQ:FTDR) is the most popular stock in this table. On the other hand Certara, Inc. (NASDAQ:CERT) is the least popular one with only 7 bullish hedge fund positions. Ryman Hospitality Properties, Inc. (NYSE:RHP) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for RHP is 55.8. 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 24% in 2021 through October 22nd and still beat the market by 1.6 percentage points. Hedge funds were also right about betting on RHP as the stock returned 6.3% since the end of Q2 (through 10/22) 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.