Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Qualtrics International Inc. (NASDAQ:XM) in this article.
Qualtrics International Inc. (NASDAQ:XM) was in 26 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 37. XM has experienced a decrease in enthusiasm from smart money in recent months. There were 37 hedge funds in our database with XM holdings at the end of June. Our calculations also showed that XM 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 check out the recent hedge fund action encompassing Qualtrics International Inc. (NASDAQ:XM).
Ken Griffin of Citadel Investment Group
Do Hedge Funds Think XM Is A Good Stock To Buy Now?
At Q3’s end, a total of 26 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -30% from one quarter earlier. On the other hand, there were a total of 0 hedge funds with a bullish position in XM 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.
The largest stake in Qualtrics International Inc. (NASDAQ:XM) was held by Silver Lake Partners, which reported holding $971.7 million worth of stock at the end of September. It was followed by Alkeon Capital Management with a $194.6 million position. Other investors bullish on the company included Tiger Global Management LLC, VGI Partners, and Citadel Investment Group. In terms of the portfolio weights assigned to each position VGI Partners allocated the biggest weight to Qualtrics International Inc. (NASDAQ:XM), around 10.77% of its 13F portfolio. Silver Lake Partners is also relatively very bullish on the stock, designating 5.97 percent of its 13F equity portfolio to XM.
Due to the fact that Qualtrics International Inc. (NASDAQ:XM) has experienced a decline in interest from the entirety of the hedge funds we track, it’s safe to say that there were a few hedgies that elected to cut their positions entirely heading into Q4. At the top of the heap, Steve Cohen’s Point72 Asset Management dumped the largest investment of the 750 funds followed by Insider Monkey, comprising close to $20.8 million in stock. Brian Ashford-Russell and Tim Woolley’s fund, Polar Capital, also said goodbye to its stock, about $14.4 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 11 funds heading into Q4.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Qualtrics International Inc. (NASDAQ:XM) but similarly valued. We will take a look at Warner Music Group Corp. (NASDAQ:WMG), Waters Corporation (NYSE:WAT), PerkinElmer, Inc. (NYSE:PKI), International Paper Company (NYSE:IP), Kellogg Company (NYSE:K), KE Holdings Inc (NYSE:BEKE), and Ventas, Inc. (NYSE:VTR). This group of stocks’ market valuations are similar to XM’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WMG | 28 | 972824 | -1 |
| WAT | 40 | 2673486 | 0 |
| PKI | 31 | 1920736 | -1 |
| IP | 30 | 263108 | -1 |
| K | 22 | 290019 | -10 |
| BEKE | 26 | 1740683 | -5 |
| VTR | 23 | 464641 | -2 |
| Average | 28.6 | 1189357 | -2.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 28.6 hedge funds with bullish positions and the average amount invested in these stocks was $1189 million. That figure was $1694 million in XM’s case. Waters Corporation (NYSE:WAT) is the most popular stock in this table. On the other hand Kellogg Company (NYSE:K) is the least popular one with only 22 bullish hedge fund positions. Qualtrics International Inc. (NASDAQ:XM) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for XM is 26.2. 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. This is a slightly negative signal and 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 surpassed the market again by 5.1 percentage points. Unfortunately XM wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); XM investors were disappointed as the stock returned -21.2% 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 most of these stocks already outperformed the market in 2021.
Follow Qualtrics International Inc. (NASDAQ:XM)
Follow Qualtrics International Inc. (NASDAQ:XM)
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Disclosure: None. This article was originally published at Insider Monkey.
