Do Hedge Funds Love National Instruments Corporation (NATI)?

In this article we will take a look at whether hedge funds think National Instruments Corporation (NASDAQ:NATI) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.

National Instruments Corporation (NASDAQ:NATI) has experienced an increase in activity from the world’s largest hedge funds recently. National Instruments Corporation (NASDAQ:NATI) was in 21 hedge funds’ portfolios at the end of March. The all time high for this statistic is 35. Our calculations also showed that NATI isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

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Matthew Hulsizer of PEAK6 Capital

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Chuck Schumer recently stated that marijuana legalization will be a Senate priority. So, we are checking out this under the radar stock that will benefit from this. We go through lists like the 10 best battery 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 check out the recent hedge fund action regarding National Instruments Corporation (NASDAQ:NATI).

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

At the end of March, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 17% from the fourth quarter of 2020. The graph below displays the number of hedge funds with bullish position in NATI over the last 23 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is NATI A Good Stock To Buy?

The largest stake in National Instruments Corporation (NASDAQ:NATI) was held by Royce & Associates, which reported holding $75.9 million worth of stock at the end of December. It was followed by Bares Capital Management with a $36.9 million position. Other investors bullish on the company included Woodline Partners, Millennium Management, and D E Shaw. In terms of the portfolio weights assigned to each position Brasada Capital Management allocated the biggest weight to National Instruments Corporation (NASDAQ:NATI), around 0.84% of its 13F portfolio. Fairpointe Capital is also relatively very bullish on the stock, designating 0.77 percent of its 13F equity portfolio to NATI.

Now, some big names were breaking ground themselves. Renaissance Technologies, managed by Jim Simons (founder), created the most valuable position in National Instruments Corporation (NASDAQ:NATI). Renaissance Technologies had $8 million invested in the company at the end of the quarter. Mark McMeans’s Brasada Capital Management also made a $3.9 million investment in the stock during the quarter. The other funds with brand new NATI positions are Donald Sussman’s Paloma Partners, Alec Litowitz and Ross Laser’s Magnetar Capital, and Greg Eisner’s Engineers Gate Manager.

Let’s also examine hedge fund activity in other stocks similar to National Instruments Corporation (NASDAQ:NATI). We will take a look at Eastgroup Properties Inc (NYSE:EGP), Unum Group (NYSE:UNM), PLDT Inc. (NYSE:PHI), Eagle Materials, Inc. (NYSE:EXP), Haemonetics Corporation (NYSE:HAE), NeoGenomics, Inc. (NASDAQ:NEO), and Blueprint Medicines Corporation (NASDAQ:BPMC). This group of stocks’ market caps resemble NATI’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
EGP 13 82942 0
UNM 33 283684 8
PHI 4 86933 0
EXP 35 348037 -2
HAE 37 585529 5
NEO 15 80571 0
BPMC 31 1058340 -7
Average 24 360862 0.6

View table here if you experience formatting issues.

As you can see these stocks had an average of 24 hedge funds with bullish positions and the average amount invested in these stocks was $361 million. That figure was $249 million in NATI’s case. Haemonetics Corporation (NYSE:HAE) is the most popular stock in this table. On the other hand PLDT Inc. (NYSE:PHI) is the least popular one with only 4 bullish hedge fund positions. National Instruments Corporation (NASDAQ:NATI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for NATI is 51.8. 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. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. 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 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately NATI wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); NATI investors were disappointed as the stock returned -4.2% since the end of March (through 7/16) 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 most of these stocks already outperformed the market in 2021.

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