After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Exponent, Inc. (NASDAQ:EXPO).
Is Exponent, Inc. (NASDAQ:EXPO) a healthy stock for your portfolio? The smart money was becoming hopeful. The number of bullish hedge fund bets moved up by 1 lately. Exponent, Inc. (NASDAQ:EXPO) was in 21 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 25. Our calculations also showed that EXPO isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
Bruce Kovner of Caxton Associates LP
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. With all of this in mind we’re going to take a look at the key hedge fund action encompassing Exponent, Inc. (NASDAQ:EXPO).
Do Hedge Funds Think EXPO Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 5% from the second quarter of 2021. By comparison, 25 hedge funds held shares or bullish call options in EXPO a year ago. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Driehaus Capital, managed by Richard Driehaus, holds the largest position in Exponent, Inc. (NASDAQ:EXPO). Driehaus Capital has a $27 million position in the stock, comprising 0.3% of its 13F portfolio. Sitting at the No. 2 spot is Sandler Capital Management, managed by Andrew Sandler, which holds a $22.9 million position; 2% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors that hold long positions comprise Paul Marshall and Ian Wace’s Marshall Wace LLP, Noam Gottesman’s GLG Partners and Chuck Royce’s Royce & Associates. In terms of the portfolio weights assigned to each position Sandler Capital Management allocated the biggest weight to Exponent, Inc. (NASDAQ:EXPO), around 2.03% of its 13F portfolio. Montanaro Asset Management is also relatively very bullish on the stock, designating 1.04 percent of its 13F equity portfolio to EXPO.
As aggregate interest increased, key money managers have been driving this bullishness. Driehaus Capital, managed by Richard Driehaus, initiated the biggest position in Exponent, Inc. (NASDAQ:EXPO). Driehaus Capital had $27 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also made a $11.2 million investment in the stock during the quarter. The only other fund with a new position in the stock is Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital).
Let’s now review hedge fund activity in other stocks similar to Exponent, Inc. (NASDAQ:EXPO). These stocks are DCP Midstream LP (NYSE:DCP), Quidel Corporation (NASDAQ:QDEL), Manpowergroup Inc (NYSE:MAN), Autohome Inc (NYSE:ATHM), Sonoco Products Company (NYSE:SON), Vicor Corp (NASDAQ:VICR), and Graphic Packaging Holding Company (NYSE:GPK). This group of stocks’ market caps are similar to EXPO’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DCP | 4 | 18162 | 1 |
| QDEL | 22 | 252628 | 3 |
| MAN | 26 | 316244 | -1 |
| ATHM | 11 | 173382 | -5 |
| SON | 16 | 131631 | 1 |
| VICR | 13 | 266143 | 0 |
| GPK | 28 | 609921 | 1 |
| Average | 17.1 | 252587 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.1 hedge funds with bullish positions and the average amount invested in these stocks was $253 million. That figure was $126 million in EXPO’s case. Graphic Packaging Holding Company (NYSE:GPK) is the most popular stock in this table. On the other hand DCP Midstream LP (NYSE:DCP) is the least popular one with only 4 bullish hedge fund positions. Exponent, Inc. (NASDAQ:EXPO) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for EXPO is 66.6. 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 29.6% in 2021 and beat the market again by 3.6 percentage points. Unfortunately EXPO wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on EXPO were disappointed as the stock returned 3.3% since the end of September (through 12/31) 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.
Follow Exponent Inc (NASDAQ:EXPO)
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Disclosure: None. This article was originally published at Insider Monkey.
