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. In this article we look at what those investors think of Under Armour Inc (NYSE:UA).
Under Armour Inc (NYSE:UA) has experienced a decrease in hedge fund interest recently. Under Armour Inc (NYSE:UA) was in 48 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 51. Our calculations also showed that UA isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
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. With all of this in mind we’re going to view the key hedge fund action surrounding Under Armour Inc (NYSE:UA).
Mark Kingdon of Kingdon Capital
Do Hedge Funds Think UA Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 48 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 48 hedge funds with a bullish position in UA a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Adage Capital Management held the most valuable stake in Under Armour Inc (NYSE:UA), which was worth $344.5 million at the end of the third quarter. On the second spot was Arrowstreet Capital which amassed $123 million worth of shares. SRS Investment Management, SRS Investment Management, and Arrowstreet Capital 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 Kingdon Capital allocated the biggest weight to Under Armour Inc (NYSE:UA), around 2.46% of its 13F portfolio. CQS Cayman LP is also relatively very bullish on the stock, dishing out 1.6 percent of its 13F equity portfolio to UA.
Because Under Armour Inc (NYSE:UA) has experienced a decline in interest from hedge fund managers, it’s safe to say that there was a specific group of funds that elected to cut their entire stakes heading into Q4. At the top of the heap, Jimmy Levin’s Sculptor Capital sold off the biggest investment of the 750 funds followed by Insider Monkey, valued at an estimated $62.6 million in stock. Sander Gerber’s fund, Hudson Bay Capital Management, also said goodbye to its stock, about $29.9 million worth. These transactions are interesting, as total hedge fund interest was cut by 3 funds heading into Q4.
Let’s check out hedge fund activity in other stocks similar to Under Armour Inc (NYSE:UA). We will take a look at Rexford Industrial Realty Inc (NYSE:REXR), Phillips 66 Partners LP (NYSE:PSXP), The Scotts Miracle-Gro Company (NYSE:SMG), Ralph Lauren Corporation (NYSE:RL), Pinnacle West Capital Corporation (NYSE:PNW), Arrival (NASDAQ:ARVL), and Commerce Bancshares, Inc. (NASDAQ:CBSH). All of these stocks’ market caps match UA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| REXR | 29 | 358442 | 8 |
| PSXP | 5 | 31682 | 0 |
| SMG | 30 | 257473 | -2 |
| RL | 25 | 444724 | -7 |
| PNW | 21 | 175044 | 3 |
| ARVL | 4 | 10081 | -13 |
| CBSH | 16 | 106578 | 0 |
| Average | 18.6 | 197718 | -1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.6 hedge funds with bullish positions and the average amount invested in these stocks was $198 million. That figure was $1644 million in UA’s case. The Scotts Miracle-Gro Company (NYSE:SMG) is the most popular stock in this table. On the other hand Arrival (NASDAQ:ARVL) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Under Armour Inc (NYSE:UA) is more popular among hedge funds. Our overall hedge fund sentiment score for UA is 80.2. 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 returned 28.6% in 2021 through November 30th but still managed to beat the market by 5.6 percentage points. Hedge funds were also right about betting on UA as the stock returned 14.6% since the end of September (through 11/30) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Follow Under Armour Inc. (NYSE:UA)
Follow Under Armour Inc. (NYSE:UA)
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Disclosure: None. This article was originally published at Insider Monkey.
