The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. In this article we are going to take a look at smart money sentiment towards Trip.com Group Limited (NASDAQ:TCOM).
Trip.com Group Limited (NASDAQ:TCOM) shares haven’t seen a lot of action during the first quarter. Overall, hedge fund sentiment was unchanged. The stock was in 31 hedge funds’ portfolios at the end of March. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Grifols SA (NASDAQ:GRFS), Genmab A/S (NASDAQ:GMAB), and Align Technology, Inc. (NASDAQ:ALGN) to gather more data points. Our calculations also showed that TCOM isn’t among the 30 most popular stocks among hedge funds (click for Q1 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.
In the eyes of most traders, hedge funds are assumed to be underperforming, outdated financial tools of years past. While there are over 8000 funds with their doors open today, Our experts choose to focus on the top tier of this group, around 850 funds. Most estimates calculate that this group of people handle most of the hedge fund industry’s total capital, and by tailing their inimitable equity investments, Insider Monkey has formulated a number of investment strategies that have historically outstripped the broader indices. Insider Monkey’s flagship short hedge fund strategy outstripped the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind we’re going to take a gander at the new hedge fund action encompassing Trip.com Group Limited (NASDAQ:TCOM).
What have hedge funds been doing with Trip.com Group Limited (NASDAQ:TCOM)?
At Q1’s end, a total of 31 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the previous quarter. By comparison, 29 hedge funds held shares or bullish call options in TCOM a year ago. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
The largest stake in Trip.com Group Limited (NASDAQ:TCOM) was held by Fisher Asset Management, which reported holding $254.7 million worth of stock at the end of September. It was followed by Platinum Asset Management with a $135.6 million position. Other investors bullish on the company included Renaissance Technologies, Serenity Capital, and Kontiki Capital. In terms of the portfolio weights assigned to each position Kontiki Capital allocated the biggest weight to Trip.com Group Limited (NASDAQ:TCOM), around 18.38% of its 13F portfolio. Serenity Capital is also relatively very bullish on the stock, designating 15.3 percent of its 13F equity portfolio to TCOM.
Due to the fact that Trip.com Group Limited (NASDAQ:TCOM) has witnessed declining sentiment 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 heading into Q4. Intriguingly, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners cut the largest stake of all the hedgies watched by Insider Monkey, worth close to $19.7 million in stock. Dmitry Balyasny’s fund, Balyasny Asset Management, also cut its stock, about $14.1 million worth. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Trip.com Group Limited (NASDAQ:TCOM) but similarly valued. These stocks are Grifols SA (NASDAQ:GRFS), Genmab A/S (NASDAQ:GMAB), Align Technology, Inc. (NASDAQ:ALGN), and Teleflex Incorporated (NYSE:TFX). All of these stocks’ market caps are closest to TCOM’s market cap.
|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 27 hedge funds with bullish positions and the average amount invested in these stocks was $748 million. That figure was $967 million in TCOM’s case. Align Technology, Inc. (NASDAQ:ALGN) is the most popular stock in this table. On the other hand Genmab A/S (NASDAQ:GMAB) is the least popular one with only 14 bullish hedge fund positions. Trip.com Group Limited (NASDAQ:TCOM) is not the most popular stock in this group but hedge fund interest is still above average. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May but beat the market by 13.2 percentage points. Unfortunately TCOM wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on TCOM were disappointed as the stock returned 13.3% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.