Hedge Funds Are Dumping Canada Goose Holdings Inc. (GOOS)

Is Canada Goose Holdings Inc. (NYSE:GOOS) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.

Is Canada Goose Holdings Inc. (NYSE:GOOS) a good investment today? Prominent investors were taking a pessimistic view. The number of long hedge fund bets fell by 9 in recent months. Canada Goose Holdings Inc. (NYSE:GOOS) was in 10 hedge funds’ portfolios at the end of June. The all time high for this statistic is 29. Our calculations also showed that GOOS isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 19 hedge funds in our database with GOOS positions at the end of the first quarter.

In the eyes of most market participants, hedge funds are seen as slow, old financial vehicles of the past. While there are over 8000 funds in operation at the moment, We look at the moguls of this club, approximately 850 funds. These hedge fund managers control the majority of the hedge fund industry’s total asset base, and by tailing their first-class picks, Insider Monkey has formulated many investment strategies that have historically defeated Mr. Market. Insider Monkey’s flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.

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. With all of this in mind let’s analyze the fresh hedge fund action surrounding Canada Goose Holdings Inc. (NYSE:GOOS).

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

At the end of June, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -47% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards GOOS over the last 24 quarters. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Bill Miller’s Miller Value Partners has the most valuable position in Canada Goose Holdings Inc. (NYSE:GOOS), worth close to $76.1 million, comprising 1.8% of its total 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, managed by Ken Griffin, which holds a $63.6 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other members of the smart money with similar optimism comprise Israel Englander’s Millennium Management, Renaissance Technologies and Chuck Royce’s Royce & Associates. In terms of the portfolio weights assigned to each position Miller Value Partners allocated the biggest weight to Canada Goose Holdings Inc. (NYSE:GOOS), around 1.81% of its 13F portfolio. PDT Partners is also relatively very bullish on the stock, setting aside 0.39 percent of its 13F equity portfolio to GOOS.

Because Canada Goose Holdings Inc. (NYSE:GOOS) has experienced a decline in interest from the entirety of the hedge funds we track, it’s easy to see that there exists a select few money managers who sold off their positions entirely by the end of the second quarter. Intriguingly, Larry Chen and Terry Zhang’s Tairen Capital sold off the largest position of the 750 funds followed by Insider Monkey, valued at an estimated $7.6 million in stock. Richard Driehaus’s fund, Driehaus Capital, also dumped its stock, about $5.2 million worth. These moves are interesting, as total hedge fund interest fell by 9 funds by the end of the second quarter.

Let’s also examine hedge fund activity in other stocks similar to Canada Goose Holdings Inc. (NYSE:GOOS). These stocks are TTEC Holdings, Inc. (NASDAQ:TTEC), Webster Financial Corporation (NYSE:WBS), FireEye Inc (NASDAQ:FEYE), The Goodyear Tire & Rubber Company (NASDAQ:GT), Simpson Manufacturing Co, Inc. (NYSE:SSD), Sprout Social, Inc. (NASDAQ:SPT), and Daqo New Energy Corp (NYSE:DQ). This group of stocks’ market values match GOOS’s market value.

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As you can see these stocks had an average of 22.6 hedge funds with bullish positions and the average amount invested in these stocks was $270 million. That figure was $217 million in GOOS’s case. The Goodyear Tire & Rubber Company (NASDAQ:GT) is the most popular stock in this table. On the other hand TTEC Holdings, Inc. (NASDAQ:TTEC) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Canada Goose Holdings Inc. (NYSE:GOOS) is even less popular than TTEC. Our overall hedge fund sentiment score for GOOS is 6.3. 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. Hedge funds dodged a bullet by taking a bearish stance towards GOOS. Our calculations showed that the top 5 most popular hedge fund stocks returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 25.7% in 2021 through September 27th but managed to beat the market again by 6.2 percentage points. Unfortunately GOOS wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was very bearish); GOOS investors were disappointed as the stock returned -9.8% since the end of the second quarter (through 9/27) 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.