The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 867 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. Hedge funds’ consensus stock picks performed spectacularly over the last 3 years, but 2022 hasn’t been kind to hedge funds. In this article we look at how hedge funds traded Invesco Ltd. (NYSE:IVZ) and determine whether the smart money was really smart about this stock.
Invesco Ltd. (NYSE:IVZ) investors should pay attention to a decrease in support from the world’s most elite money managers of late. Invesco Ltd. (NYSE:IVZ) was in 38 hedge funds’ portfolios at the end of September. The all time high for this statistic is 40. There were 40 hedge funds in our database with IVZ holdings at the end of June. Our calculations also showed that IVZ isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Richard S. Pzena of Pzena Investment Management
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. Keeping this in mind let’s take a peek at the new hedge fund action regarding Invesco Ltd. (NYSE:IVZ).
Do Hedge Funds Think IVZ Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of -5% from the second quarter of 2021. The graph below displays the number of hedge funds with bullish position in IVZ over the last 25 quarters. With hedgies’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
Among these funds, Trian Partners held the most valuable stake in Invesco Ltd. (NYSE:IVZ), which was worth $955.7 million at the end of the third quarter. On the second spot was Pzena Investment Management which amassed $64.9 million worth of shares. Two Sigma Advisors, Millennium Management, and D E Shaw 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 Trian Partners allocated the biggest weight to Invesco Ltd. (NYSE:IVZ), around 11.88% of its 13F portfolio. Full18 Capital is also relatively very bullish on the stock, dishing out 2.67 percent of its 13F equity portfolio to IVZ.
Because Invesco Ltd. (NYSE:IVZ) has faced a decline in interest from hedge fund managers, it’s safe to say that there is a sect of fund managers who sold off their full holdings heading into Q4. Interestingly, Steve Cohen’s Point72 Asset Management sold off the largest position of the 750 funds watched by Insider Monkey, totaling an estimated $7.4 million in stock, and Sander Gerber’s Hudson Bay Capital Management was right behind this move, as the fund dumped about $5.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds heading into Q4.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Invesco Ltd. (NYSE:IVZ) but similarly valued. We will take a look at Kirkland Lake Gold Ltd. (NYSE:KL), Wix.Com Ltd (NASDAQ:WIX), ironSource Ltd. (NYSE:IS), East West Bancorp, Inc. (NASDAQ:EWBC), Cable One Inc (NYSE:CABO), Lennox International Inc. (NYSE:LII), and Formula One Group (NASDAQ:FWONA). This group of stocks’ market caps match IVZ’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| KL | 21 | 480649 | -1 |
| WIX | 25 | 740850 | -10 |
| IS | 29 | 726683 | -3 |
| EWBC | 29 | 526433 | 5 |
| CABO | 26 | 585271 | 6 |
| LII | 26 | 492417 | 0 |
| FWONA | 18 | 257601 | -4 |
| Average | 24.9 | 544272 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 24.9 hedge funds with bullish positions and the average amount invested in these stocks was $544 million. That figure was $1355 million in IVZ’s case. ironSource Ltd. (NYSE:IS) is the most popular stock in this table. On the other hand Formula One Group (NASDAQ:FWONA) is the least popular one with only 18 bullish hedge fund positions. Compared to these stocks Invesco Ltd. (NYSE:IVZ) is more popular among hedge funds. Our overall hedge fund sentiment score for IVZ is 81.5. 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, IVZ wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on IVZ were disappointed as the stock returned -5.4% 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 Invesco Ltd. (NYSE:IVZ)
Follow Invesco Ltd. (NYSE:IVZ)
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Disclosure: None. This article was originally published at Insider Monkey.
