Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 5 years and analyze what the smart money thinks of Celsius Holdings, Inc. (NASDAQ:CELH) based on that data.
Is CELH a good stock to buy now? Celsius Holdings, Inc. (NASDAQ:CELH) has seen an increase in support from the world’s most elite money managers recently. Celsius Holdings, Inc. (NASDAQ:CELH) was in 17 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 10. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that CELH isn’t 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.
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 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 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 scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks 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. Now let’s review the key hedge fund action encompassing Celsius Holdings, Inc. (NASDAQ:CELH).
Do Hedge Funds Think CELH Is A Good Stock To Buy Now?
At Q3’s end, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 70% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CELH over the last 21 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Driehaus Capital was the largest shareholder of Celsius Holdings, Inc. (NASDAQ:CELH), with a stake worth $19.1 million reported as of the end of September. Trailing Driehaus Capital was Cowbird Capital, which amassed a stake valued at $16.8 million. Point72 Asset Management, Royce & Associates, and Citadel Investment Group 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 Cowbird Capital allocated the biggest weight to Celsius Holdings, Inc. (NASDAQ:CELH), around 10.89% of its 13F portfolio. Voss Capital is also relatively very bullish on the stock, designating 1.59 percent of its 13F equity portfolio to CELH.
Consequently, key money managers were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, established the biggest position in Celsius Holdings, Inc. (NASDAQ:CELH). Point72 Asset Management had $10.6 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made a $3 million investment in the stock during the quarter. The other funds with brand new CELH positions are Israel Englander’s Millennium Management, Leonard Green’s Leonard Green & Partners, and Christopher Weldon’s Stamina Capital Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Celsius Holdings, Inc. (NASDAQ:CELH) but similarly valued. We will take a look at Hancock Whitney Corporation (NASDAQ:HWC), Steven Madden, Ltd. (NASDAQ:SHOO), 8×8, Inc. (NYSE:EGHT), United States Steel Corporation (NYSE:X), Group 1 Automotive, Inc. (NYSE:GPI), Hostess Brands, Inc. (NASDAQ:TWNK), and Rent-A-Center Inc (NASDAQ:RCII). This group of stocks’ market valuations resemble CELH’s market valuation.
|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 24 hedge funds with bullish positions and the average amount invested in these stocks was $196 million. That figure was $66 million in CELH’s case. Hostess Brands, Inc. (NASDAQ:TWNK) is the most popular stock in this table. On the other hand United States Steel Corporation (NYSE:X) is the least popular one with only 21 bullish hedge fund positions. Compared to these stocks Celsius Holdings, Inc. (NASDAQ:CELH) is even less popular than X. Our overall hedge fund sentiment score for CELH is 40. 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. Hedge funds clearly dropped the ball on CELH as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. 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 gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. A small number of hedge funds were also right about betting on CELH as the stock returned 57% since Q3 (through December 14th) and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.