Hedge Funds Are Betting On The Goldman Sachs Group, Inc. (GS)

As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the fourth quarter of 2019. A significant number of hedge funds continued their strong performance in 2020 and 2021 as well. We get to see hedge funds’ thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about The Goldman Sachs Group, Inc. (NYSE:GS).

The Goldman Sachs Group, Inc. (NYSE:GS) was in 74 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 78. GS investors should pay attention to an increase in hedge fund interest in recent months. There were 61 hedge funds in our database with GS positions at the end of the second quarter. Our calculations also showed that GS 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. Keeping this in mind let’s review the recent hedge fund action encompassing The Goldman Sachs Group, Inc. (NYSE:GS).

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

At Q3’s end, a total of 74 of the hedge funds tracked by Insider Monkey were long this stock, a change of 21% from the second quarter of 2021. On the other hand, there were a total of 70 hedge funds with a bullish position in GS a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, Eagle Capital Management held the most valuable stake in The Goldman Sachs Group, Inc. (NYSE:GS), which was worth $1386.9 million at the end of the third quarter. On the second spot was Fisher Asset Management which amassed $1069 million worth of shares. Greenhaven Associates, Citadel Investment Group, and Balyasny Asset 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 Greenhaven Associates allocated the biggest weight to The Goldman Sachs Group, Inc. (NYSE:GS), around 25.4% of its 13F portfolio. Truvvo Partners is also relatively very bullish on the stock, dishing out 8.64 percent of its 13F equity portfolio to GS.

Now, key money managers have jumped into The Goldman Sachs Group, Inc. (NYSE:GS) headfirst. Renaissance Technologies, created the largest position in The Goldman Sachs Group, Inc. (NYSE:GS). Renaissance Technologies had $120.9 million invested in the company at the end of the quarter. Benjamin A. Smith’s Laurion Capital Management also initiated a $81.5 million position during the quarter. The following funds were also among the new GS investors: Daniel Johnson’s Gillson Capital, Steve Cohen’s Point72 Asset Management, and Morris Mark’s Mark Asset Management.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as The Goldman Sachs Group, Inc. (NYSE:GS) but similarly valued. We will take a look at TotalEnergies SE (NYSE:TTE), Advanced Micro Devices, Inc. (NASDAQ:AMD), International Business Machines Corp. (NYSE:IBM), ServiceNow Inc (NYSE:NOW), Sanofi (NASDAQ:SNY), American Tower Corporation (NYSE:AMT), and Amgen, Inc. (NASDAQ:AMGN). This group of stocks’ market caps match GS’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 48.7 hedge funds with bullish positions and the average amount invested in these stocks was $3257 million. That figure was $5452 million in GS’s case. ServiceNow Inc (NYSE:NOW) is the most popular stock in this table. On the other hand TotalEnergies SE (NYSE:TTE) is the least popular one with only 16 bullish hedge fund positions. The Goldman Sachs Group, Inc. (NYSE:GS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GS is 79.3. 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 positive signal but 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 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately GS wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on GS were disappointed as the stock returned 0.8% since the end of September (through 11/30) 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 many of these stocks already outperformed the market since 2019.

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