The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on September 30th, about a month before the elections. We at Insider Monkey have made an extensive database of more than 817 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Booking Holdings Inc. (NASDAQ:BKNG) based on those filings.
Booking Holdings Inc. (NASDAQ:BKNG) was in 113 hedge funds’ portfolios at the end of September. The all time high for this statistics is 98. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. BKNG investors should be aware of an increase in hedge fund sentiment of late. There were 96 hedge funds in our database with BKNG holdings at the end of June. Our calculations also showed that BKNG ranked 13th among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 66 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’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Gil Simon of SoMa Equity Partners
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets. Tesla’s stock price skyrocketed, yet lithium prices are still below their 2019 highs. So, we are checking out this lithium stock right now. We go through lists like the 15 best blue chip stocks to buy to pick the best large-cap stocks to buy. 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 website. With all of this in mind let’s take a look at the latest hedge fund action regarding Booking Holdings Inc. (NASDAQ:BKNG).
What have hedge funds been doing with Booking Holdings Inc. (NASDAQ:BKNG)?
At the end of September, a total of 113 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 18% from one quarter earlier. By comparison, 87 hedge funds held shares or bullish call options in BKNG a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Gabriel Plotkin’s Melvin Capital Management has the number one position in Booking Holdings Inc. (NASDAQ:BKNG), worth close to $878.3 million, corresponding to 4.4% of its total 13F portfolio. Coming in second is Viking Global, managed by Andreas Halvorsen, which holds a $596.1 million position; the fund has 2.2% of its 13F portfolio invested in the stock. Other hedge funds and institutional investors with similar optimism comprise Ken Griffin’s Citadel Investment Group, and Ric Dillon’s Diamond Hill Capital. In terms of the portfolio weights assigned to each position PAR Capital Management allocated the biggest weight to Booking Holdings Inc. (NASDAQ:BKNG), around 10.51% of its 13F portfolio. SoMa Equity Partners is also relatively very bullish on the stock, setting aside 8.21 percent of its 13F equity portfolio to BKNG.
Now, some big names were leading the bulls’ herd. Egerton Capital Limited, managed by John Armitage, initiated the most valuable position in Booking Holdings Inc. (NASDAQ:BKNG). Egerton Capital Limited had $257.8 million invested in the company at the end of the quarter. Gil Simon’s SoMa Equity Partners also made a $256.6 million investment in the stock during the quarter. The following funds were also among the new BKNG investors: Anand Desai’s Darsana Capital Partners, Andrew Immerman and Jeremy Schiffman’s Palestra Capital Management, and Richard S. Pzena’s Pzena Investment Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Booking Holdings Inc. (NASDAQ:BKNG) but similarly valued. We will take a look at Crown Castle International Corp. (REIT) (NYSE:CCI), Deere & Company (NYSE:DE), The Goldman Sachs Group, Inc. (NYSE:GS), Fiserv, Inc. (NASDAQ:FISV), Anthem Inc (NYSE:ANTM), Becton, Dickinson and Company (NYSE:BDX), and Equinix, Inc. (REIT) (NASDAQ:EQIX). All of these stocks’ market caps match BKNG’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CCI | 42 | 2127288 | -1 |
| DE | 42 | 1308976 | 10 |
| GS | 70 | 3633681 | 1 |
| FISV | 90 | 5404170 | 5 |
| ANTM | 65 | 4505466 | -4 |
| BDX | 62 | 1939356 | 9 |
| EQIX | 42 | 2270352 | -7 |
| Average | 59 | 3027041 | 1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 59 hedge funds with bullish positions and the average amount invested in these stocks was $3027 million. That figure was $6675 million in BKNG’s case. Fiserv, Inc. (NASDAQ:FISV) is the most popular stock in this table. On the other hand Crown Castle International Corp. (REIT) (NYSE:CCI) is the least popular one with only 42 bullish hedge fund positions. Compared to these stocks Booking Holdings Inc. (NASDAQ:BKNG) is more popular among hedge funds. Our overall hedge fund sentiment score for BKNG is 94. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks returned 28.1% in 2020 through November 23rd but still managed to beat the market by 15.4 percentage points. Hedge funds were also right about betting on BKNG as the stock returned 18.1% since the end of September (through 11/23) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
