Is BERY Stock A Buy or Sell?

In this article we will take a look at whether hedge funds think Berry Global Group Inc (NYSE:BERY) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.

Is BERY stock a buy or sell? Investors who are in the know were getting less optimistic. The number of bullish hedge fund positions dropped by 9 lately. Berry Global Group Inc (NYSE:BERY) was in 34 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 53. Our calculations also showed that BERY isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 197% since March 2017 and outperformed the S&P 500 ETFs by more than 124 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 10 best battery stocks to buy to identify the next stock with 10x upside potential. 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. Now let’s view the key hedge fund action regarding Berry Global Group Inc (NYSE:BERY).

Do Hedge Funds Think BERY Is A Good Stock To Buy Now?

At Q4’s end, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -21% from the third quarter of 2020. On the other hand, there were a total of 47 hedge funds with a bullish position in BERY 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.

More specifically, Eminence Capital was the largest shareholder of Berry Global Group Inc (NYSE:BERY), with a stake worth $367.5 million reported as of the end of December. Trailing Eminence Capital was Canyon Capital Advisors, which amassed a stake valued at $280.7 million. Lyrical Asset Management, Two Creeks Capital Management, and Arrowstreet Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Canyon Capital Advisors allocated the biggest weight to Berry Global Group Inc (NYSE:BERY), around 12.12% of its 13F portfolio. SCW Capital Management is also relatively very bullish on the stock, designating 11.27 percent of its 13F equity portfolio to BERY.

Judging by the fact that Berry Global Group Inc (NYSE:BERY) has faced falling interest from hedge fund managers, it’s easy to see that there lies a certain “tier” of money managers who were dropping their entire stakes by the end of the fourth quarter. At the top of the heap, Jeffrey Jacobowitz’s Simcoe Capital Management cut the biggest position of the 750 funds tracked by Insider Monkey, worth about $21.4 million in stock. Israel Englander’s fund, Millennium Management, also said goodbye to its stock, about $18.8 million worth. These moves are important to note, as total hedge fund interest dropped by 9 funds by the end of the fourth quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Berry Global Group Inc (NYSE:BERY) but similarly valued. We will take a look at Nielsen Holdings plc (NYSE:NLSN), Kodiak Sciences Inc (NASDAQ:KOD), Voya Financial Inc (NYSE:VOYA), Juniper Networks, Inc. (NYSE:JNPR), Cenovus Energy Inc (NYSE:CVE), Skillz Inc. (NYSE:SKLZ), and InVitae Corporation (NYSE:NVTA). This group of stocks’ market valuations are closest to BERY’s market valuation.

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As you can see these stocks had an average of 31.4 hedge funds with bullish positions and the average amount invested in these stocks was $1448 million. That figure was $1290 million in BERY’s case. Voya Financial Inc (NYSE:VOYA) is the most popular stock in this table. On the other hand Kodiak Sciences Inc (NASDAQ:KOD) is the least popular one with only 20 bullish hedge fund positions. Berry Global Group Inc (NYSE:BERY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for BERY is 44.4. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 7.9% in 2021 through April 1st and still beat the market by 0.4 percentage points. Hedge funds were also right about betting on BERY as the stock returned 9.6% since the end of Q4 (through 4/1) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

Disclosure: None. This article was originally published at Insider Monkey.