We at Insider Monkey have gone over 873 13F filings that hedge funds and prominent investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of June 30th. In this article, we look at what those funds think of Skyworks Solutions Inc (NASDAQ:SWKS) based on that data.
Is Skyworks Solutions Inc (NASDAQ:SWKS) a bargain? Prominent investors were buying. The number of bullish hedge fund positions increased by 4 recently. Skyworks Solutions Inc (NASDAQ:SWKS) was in 37 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 50. Our calculations also showed that SWKS isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 33 hedge funds in our database with SWKS holdings at the end of March.
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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, we like undervalued, EBITDA-positive growth stocks, so we are checking out stock pitches like this emerging biotech 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 we’re going to take a peek at the latest hedge fund action regarding Skyworks Solutions Inc (NASDAQ:SWKS).
Do Hedge Funds Think SWKS Is A Good Stock To Buy Now?
At second quarter’s end, a total of 37 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 12% from the first quarter of 2020. The graph below displays the number of hedge funds with bullish position in SWKS over the last 24 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Select Equity Group was the largest shareholder of Skyworks Solutions Inc (NASDAQ:SWKS), with a stake worth $255.4 million reported as of the end of June. Trailing Select Equity Group was AQR Capital Management, which amassed a stake valued at $232.9 million. Citadel Investment Group, Platinum Asset Management, and PEAK6 Capital 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 Force Hill Capital Management allocated the biggest weight to Skyworks Solutions Inc (NASDAQ:SWKS), around 3.05% of its 13F portfolio. Platinum Asset Management is also relatively very bullish on the stock, dishing out 1.87 percent of its 13F equity portfolio to SWKS.
Consequently, key money managers were breaking ground themselves. Woodline Partners, managed by Michael Rockefeller and KarláKroeker, created the biggest position in Skyworks Solutions Inc (NASDAQ:SWKS). Woodline Partners had $35.8 million invested in the company at the end of the quarter. Steve Cohen’s Point72 Asset Management also made a $35 million investment in the stock during the quarter. The other funds with brand new SWKS positions are Suraj Parkash Chopra’s Force Hill Capital Management, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors, and Richard Mashaal’s Rima Senvest Management.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Skyworks Solutions Inc (NASDAQ:SWKS) but similarly valued. We will take a look at Li Auto Inc. (NASDAQ:LI), Chunghwa Telecom Co., Ltd (NYSE:CHT), Southwest Airlines Co. (NYSE:LUV), Carnival Corporation & plc (NYSE:CCL), Waste Connections, Inc. (NYSE:WCN), Copart, Inc. (NASDAQ:CPRT), and Lennar Corporation (NYSE:LEN). This group of stocks’ market values are similar to SWKS’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.3 hedge funds with bullish positions and the average amount invested in these stocks was $819 million. That figure was $924 million in SWKS’s case. Lennar Corporation (NYSE:LEN) is the most popular stock in this table. On the other hand Chunghwa Telecom Co., Ltd (NYSE:CHT) is the least popular one with only 7 bullish hedge fund positions. Skyworks Solutions Inc (NASDAQ:SWKS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SWKS is 66.1. 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 21.8% in 2021 through October 11th and beat the market again by 4.4 percentage points. Unfortunately SWKS wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on SWKS were disappointed as the stock returned -16.6% since the end of June (through 10/11) 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.