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 have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider Evercore Inc. (NYSE:EVR) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is Evercore Inc. (NYSE:EVR) a buy, sell, or hold? Money managers were betting on the stock. The number of bullish hedge fund positions inched up by 3 recently. Evercore Inc. (NYSE:EVR) was in 31 hedge funds’ portfolios at the end of March. The all time high for this statistic is 33. Our calculations also showed that EVR isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 let’s go over the new hedge fund action encompassing Evercore Inc. (NYSE:EVR).
Do Hedge Funds Think EVR Is A Good Stock To Buy Now?
At first quarter’s end, a total of 31 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 11% from the fourth quarter of 2020. By comparison, 29 hedge funds held shares or bullish call options in EVR a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Evercore Inc. (NYSE:EVR) was held by Millennium Management, which reported holding $69.6 million worth of stock at the end of December. It was followed by Samlyn Capital with a $45.9 million position. Other investors bullish on the company included Royce & Associates, Ariel Investments, and Citadel Investment Group. In terms of the portfolio weights assigned to each position CSat Investment Advisory allocated the biggest weight to Evercore Inc. (NYSE:EVR), around 0.7% of its 13F portfolio. Samlyn Capital is also relatively very bullish on the stock, designating 0.63 percent of its 13F equity portfolio to EVR.
As aggregate interest increased, some big names were breaking ground themselves. CaaS Capital, managed by Frank Fu, created the largest position in Evercore Inc. (NYSE:EVR). CaaS Capital had $18.7 million invested in the company at the end of the quarter. Daniel Johnson’s Gillson Capital also initiated a $6.2 million position during the quarter. The following funds were also among the new EVR investors: Donald Sussman’s Paloma Partners, Gregg Moskowitz’s Interval Partners, and Mika Toikka’s AlphaCrest Capital Management.
Let’s check out hedge fund activity in other stocks similar to Evercore Inc. (NYSE:EVR). These stocks are Nextera Energy Partners LP (NYSE:NEP), Tandem Diabetes Care Inc (NASDAQ:TNDM), Douglas Emmett, Inc. (NYSE:DEI), SolarWinds Corporation (NYSE:SWI), Crane Co. (NYSE:CR), MAXIMUS, Inc. (NYSE:MMS), and Braskem SA (NYSE:BAK). All of these stocks’ market caps resemble EVR’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
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As you can see these stocks had an average of 17.3 hedge funds with bullish positions and the average amount invested in these stocks was $490 million. That figure was $365 million in EVR’s case. Tandem Diabetes Care Inc (NASDAQ:TNDM) is the most popular stock in this table. On the other hand Braskem SA (NYSE:BAK) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Evercore Inc. (NYSE:EVR) is more popular among hedge funds. Our overall hedge fund sentiment score for EVR is 86.2. 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 gained 22.8% in 2021 through July 2nd and still beat the market by 6 percentage points. Unfortunately EVR wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on EVR were disappointed as the stock returned 9.5% since the end of the first quarter (through 7/2) 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 since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.