Hedge funds and large money managers usually invest with a focus on the long-term horizon and, therefore, short-lived dips or bumps on the charts usually don’t make them change their opinion towards a company. This time it may be different. The coronavirus pandemic destroyed the high correlations among major industries and asset classes. We are now in a stock pickers market where fundamentals of a stock have more effect on the price than the overall direction of the market. As a result we observe sudden and large changes in hedge fund positions depending on the news flow. Let’s take a look at the hedge fund sentiment towards Elevate Credit, Inc. (NYSE:ELVT) to find out whether there were any major changes in hedge funds’ views.
Elevate Credit, Inc. (NYSE:ELVT) has experienced an increase in hedge fund sentiment of late. Elevate Credit, Inc. (NYSE:ELVT) was in 10 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 13. There were 8 hedge funds in our database with ELVT positions at the end of the first quarter. Our calculations also showed that ELVT isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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Do Hedge Funds Think ELVT Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 25% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards ELVT over the last 24 quarters. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
More specifically, Renaissance Technologies was the largest shareholder of Elevate Credit, Inc. (NYSE:ELVT), with a stake worth $4.6 million reported as of the end of June. Trailing Renaissance Technologies was Empyrean Capital Partners, which amassed a stake valued at $2.7 million. D E Shaw, Arrowstreet Capital, and Two Sigma Advisors 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 Empyrean Capital Partners allocated the biggest weight to Elevate Credit, Inc. (NYSE:ELVT), around 0.06% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, earmarking 0.02 percent of its 13F equity portfolio to ELVT.
As aggregate interest increased, some big names have jumped into Elevate Credit, Inc. (NYSE:ELVT) headfirst. Empyrean Capital Partners, managed by Michael A. Price and Amos Meron, created the most outsized position in Elevate Credit, Inc. (NYSE:ELVT). Empyrean Capital Partners had $2.7 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also made a $0.1 million investment in the stock during the quarter. The other funds with brand new ELVT positions are Ken Griffin’s Citadel Investment Group and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Elevate Credit, Inc. (NYSE:ELVT) but similarly valued. These stocks are BG Staffing Inc (NYSE:BGSF), Ocean Power Technologies Inc (NASDAQ:OPTT), Genocea Biosciences Inc (NASDAQ:GNCA), Processa Pharmaceuticals, Inc. (NASDAQ:PCSA), Marchex, Inc. (NASDAQ:MCHX), Auburn National Bancorporation, Inc. (NASDAQ:AUBN), and Limestone Bancorp, Inc. (NASDAQ:LMST). All of these stocks’ market caps resemble ELVT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BGSF | 7 | 5775 | 0 |
| OPTT | 1 | 979 | -1 |
| GNCA | 13 | 45014 | 2 |
| PCSA | 4 | 5303 | 0 |
| MCHX | 6 | 9749 | 0 |
| AUBN | 2 | 1426 | 1 |
| LMST | 6 | 11507 | 2 |
| Average | 5.6 | 11393 | 0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.6 hedge funds with bullish positions and the average amount invested in these stocks was $11 million. That figure was $12 million in ELVT’s case. Genocea Biosciences Inc (NASDAQ:GNCA) is the most popular stock in this table. On the other hand Ocean Power Technologies Inc (NASDAQ:OPTT) is the least popular one with only 1 bullish hedge fund positions. Elevate Credit, Inc. (NYSE:ELVT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for ELVT is 67.6. 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. 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 25.7% in 2021 through September 27th and still beat the market by 6.2 percentage points. Hedge funds were also right about betting on ELVT as the stock returned 6.4% since the end of Q2 (through 9/27) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
