Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Coursera, Inc. (NYSE:COUR).
Is Coursera, Inc. (NYSE:COUR) a buy right now? The best stock pickers were becoming more confident. The number of bullish hedge fund bets increased by 14 recently. Coursera, Inc. (NYSE:COUR) was in 25 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 25. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that COUR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 11 hedge funds in our database with COUR holdings at the end of June.
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. Now let’s take a gander at the key hedge fund action surrounding Coursera, Inc. (NYSE:COUR).
Israel Englander of Millennium Management
Do Hedge Funds Think COUR Is A Good Stock To Buy Now?
At third quarter’s end, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 127% from one quarter earlier. By comparison, 0 hedge funds held shares or bullish call options in COUR a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Shannon River Fund Management held the most valuable stake in Coursera, Inc. (NYSE:COUR), which was worth $38 million at the end of the third quarter. On the second spot was Millennium Management which amassed $25 million worth of shares. Zevenbergen Capital Investments, Holocene Advisors, and Islet 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 Cartenna Capital allocated the biggest weight to Coursera, Inc. (NYSE:COUR), around 4.24% of its 13F portfolio. Shannon River Fund Management is also relatively very bullish on the stock, dishing out 2.68 percent of its 13F equity portfolio to COUR.
Consequently, key hedge funds have been driving this bullishness. Shannon River Fund Management, managed by Spencer M. Waxman, initiated the most valuable position in Coursera, Inc. (NYSE:COUR). Shannon River Fund Management had $38 million invested in the company at the end of the quarter. Brandon Haley’s Holocene Advisors also made a $13.6 million investment in the stock during the quarter. The other funds with brand new COUR positions are Joseph Samuels’s Islet Management, Peter Avellone’s Cartenna Capital, and Ray Dalio’s Bridgewater Associates.
Let’s check out hedge fund activity in other stocks similar to Coursera, Inc. (NYSE:COUR). We will take a look at American Eagle Outfitters Inc. (NYSE:AEO), Ortho Clinical Diagnostics Holdings plc (NASDAQ:OCDX), Fisker Inc. (NYSE:FSR), Qualys Inc (NASDAQ:QLYS), Healthcare Realty Trust Inc (NYSE:HR), Arvinas, Inc. (NASDAQ:ARVN), and Murphy USA Inc. (NYSE:MUSA). All of these stocks’ market caps are closest to COUR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AEO | 24 | 1208509 | -17 |
| OCDX | 30 | 272834 | 9 |
| FSR | 15 | 228103 | -1 |
| QLYS | 18 | 220919 | -2 |
| HR | 18 | 210905 | -1 |
| ARVN | 25 | 312887 | -1 |
| MUSA | 17 | 311081 | -9 |
| Average | 21 | 395034 | -3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $395 million. That figure was $174 million in COUR’s case. Ortho Clinical Diagnostics Holdings plc (NASDAQ:OCDX) is the most popular stock in this table. On the other hand Fisker Inc. (NYSE:FSR) is the least popular one with only 15 bullish hedge fund positions. Coursera, Inc. (NYSE:COUR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for COUR is 73.3. 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 31.1% in 2021 through December 9th and beat the market again by 5.1 percentage points. Unfortunately COUR wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on COUR were disappointed as the stock returned -16.6% since the end of September (through 12/9) 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.
