Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Bath & Body Works Inc. (NYSE:BBWI) based on that data and determine whether they were really smart about the stock.
Is Bath & Body Works Inc. (NYSE:BBWI) a buy, sell, or hold? The smart money was getting more bullish. The number of long hedge fund bets increased by 3 recently. Bath & Body Works Inc. (NYSE:BBWI) was in 56 hedge funds’ portfolios at the end of September. The all time high for this statistic is 59. Our calculations also showed that BBWI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 53 hedge funds in our database with BBWI 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 check out the latest hedge fund action surrounding Bath & Body Works Inc. (NYSE:BBWI).
Gabriel Plotkin of Melvin Capital Management
Do Hedge Funds Think BBWI Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 56 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. On the other hand, there were a total of 45 hedge funds with a bullish position in BBWI a year ago. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
The largest stake in Bath & Body Works Inc. (NYSE:BBWI) was held by Lone Pine Capital, which reported holding $1531.6 million worth of stock at the end of September. It was followed by Egerton Capital Limited with a $889.1 million position. Other investors bullish on the company included D1 Capital Partners, Melvin Capital Management, and Steadfast Capital Management. In terms of the portfolio weights assigned to each position Barington Capital Group allocated the biggest weight to Bath & Body Works Inc. (NYSE:BBWI), around 26.19% of its 13F portfolio. Makaira Partners is also relatively very bullish on the stock, designating 17.97 percent of its 13F equity portfolio to BBWI.
As aggregate interest increased, specific money managers were breaking ground themselves. Lone Pine Capital, assembled the biggest position in Bath & Body Works Inc. (NYSE:BBWI). Lone Pine Capital had $1.5316 billion invested in the company at the end of the quarter. John Armitage’s Egerton Capital Limited also initiated a $889.1 million position during the quarter. The other funds with brand new BBWI positions are Daniel Sundheim’s D1 Capital Partners, Gabriel Plotkin’s Melvin Capital Management, and Robert Pitts’s Steadfast Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to Bath & Body Works Inc. (NYSE:BBWI). These stocks are Full Truck Alliance Co. Ltd. (NYSE:YMM), Brookfield Infrastructure Partners L.P. (NYSE:BIP), Liberty Global plc (NASDAQ:LBTYA), Signature Bank (NASDAQ:SBNY), PPD, Inc. (NASDAQ:PPD), EXACT Sciences Corporation (NASDAQ:EXAS), and Markel Corporation (NYSE:MKL). This group of stocks’ market valuations are similar to BBWI’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| YMM | 13 | 263866 | 13 |
| BIP | 15 | 104470 | -1 |
| LBTYA | 34 | 791291 | 4 |
| SBNY | 46 | 950619 | 3 |
| PPD | 37 | 1890261 | 0 |
| EXAS | 40 | 1984372 | 5 |
| MKL | 25 | 689937 | -8 |
| Average | 30 | 953545 | 2.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 30 hedge funds with bullish positions and the average amount invested in these stocks was $954 million. That figure was $6557 million in BBWI’s case. Signature Bank (NASDAQ:SBNY) is the most popular stock in this table. On the other hand Full Truck Alliance Co. Ltd. (NYSE:YMM) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks Bath & Body Works Inc. (NYSE:BBWI) is more popular among hedge funds. Our overall hedge fund sentiment score for BBWI is 86.5. 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 and still beat the market by 3.6 percentage points. Unfortunately, BBWI wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on BBWI were disappointed as the stock returned -10.9% since the end of the third quarter (through 1/31) 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 all of these stocks already outperformed the market since 2019.
Follow Bath & Body Works Inc. (NYSE:BBWI)
Follow Bath & Body Works Inc. (NYSE:BBWI)
Suggested Articles:
- 50 Most Beautiful Cities in the US
- 10 Best Growth Stocks for the Next 10 Years
- 10 Companies That Will Benefit From Global Warming
Disclosure: None. This article was originally published at Insider Monkey.
