Here Is What Hedge Funds Think About Fiserv Inc. (FISV)

Reputable billionaire investors such as Nelson Peltz and David Tepper generate exorbitant profits for their wealthy accredited investors (a minimum of $1 million in investable assets would be required to invest in a hedge fund and most successful hedge funds won’t accept your savings unless you commit at least $5 million) by pinpointing winning small-cap stocks. There is little or no publicly-available information at all on some of these small companies, which makes it hard for an individual investor to pin down a winner within the small-cap space. However, hedge funds and other big asset managers can do the due diligence and analysis for you instead, thanks to their highly-skilled research teams and vast resources to conduct an appropriate evaluation process. Looking for potential winners within the small-cap galaxy of stocks? We believe following the smart money is a good starting point.

Is Fiserv Inc. (NASDAQ:FISV) a cheap stock to buy now? The smart money is turning bullish. The number of bullish hedge fund positions advanced by 1 lately. FISV was in 27 hedge funds’ portfolios at the end of September. There were 26 hedge funds in our database with FISV positions at the end of the previous quarter. At the end of this article we will also compare FISV to other stocks including Fidelity National Information Services (NYSE:FIS), Zimmer Biomet Holdings Inc (NYSE:ZBH), and Valero Energy Corporation (NYSE:VLO) to get a better sense of its popularity.

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How are hedge funds trading Fiserv Inc. (NASDAQ:FISV)?

Heading into the fourth quarter of 2016, a total of 27 of the hedge funds tracked by Insider Monkey were bullish on this stock, a 4% uptick from the previous quarter. Ownership of the stock has trended up for the last 2 quarters, but has remained in a narrow range over the last year. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their stakes significantly (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Cliff Asness’ AQR Capital Management has the number one position in Fiserv Inc. (NASDAQ:FISV), worth close to $88.8 million. On AQR Capital Management’s heels is Citadel Investment Group, managed by Ken Griffin, which holds a $49.3 million position. Some other hedge funds and institutional investors with similar optimism encompass Eric Sprott’s Sprott Asset Management, David Harding’s Winton Capital Management and Jim Simons’ Renaissance Technologies.

Consequently, key hedge funds have jumped into Fiserv, Inc. (NASDAQ:FISV) headfirst. Millennium Management, one of the 10 largest hedge funds in the world, initiated the most valuable position in Fiserv Inc. (NASDAQ:FISV). Millennium Management had $20 million invested in the company at the end of the quarter. Michael Platt and William Reeves’ BlueCrest Capital Mgmt. also made a $9.4 million investment in the stock during the quarter. The following funds were also among the new FISV investors: Ken Griffin’s Citadel Investment Group, Matthew Tewksbury’s Stevens Capital Management, and Mike Vranos’ Ellington.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Fiserv Inc. (NASDAQ:FISV) but similarly valued. We will take a look at Fidelity National Information Services (NYSE:FIS), Zimmer Biomet Holdings Inc (NYSE:ZBH), Valero Energy Corporation (NYSE:VLO), and Consolidated Edison, Inc. (NYSE:ED). This group of stocks’ market valuations match FISV’s market valuation.

As you can see these stocks had an average of 40 hedge funds with bullish positions and the average amount invested in these stocks was $1.45 billion. That figure was $366 million in FISV’s case. Fidelity National Information Services (NYSE:FIS) is the most popular stock in this table. On the other hand Consolidated Edison, Inc. (NYSE:ED) is the least popular one with only 23 bullish hedge fund positions. Fiserv Inc. (NASDAQ:FISV) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard FIS might be a better candidate to consider a long position.

Disclosure: None