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 fourth 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 Tripadvisor Inc (NASDAQ:TRIP) based on that data.
Is TRIP stock a buy or sell? Tripadvisor Inc (NASDAQ:TRIP) was in 41 hedge funds’ portfolios at the end of December. The all time high for this statistic is 43. TRIP has experienced an increase in enthusiasm from smart money lately. There were 29 hedge funds in our database with TRIP positions at the end of the third quarter. Our calculations also showed that TRIP isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).
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. Keeping this in mind let’s take a glance at the recent hedge fund action regarding Tripadvisor Inc (NASDAQ:TRIP).
Do Hedge Funds Think TRIP Is A Good Stock To Buy Now?
Heading into the first quarter of 2021, a total of 41 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 41% from the third quarter of 2020. On the other hand, there were a total of 39 hedge funds with a bullish position in TRIP a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
More specifically, PAR Capital Management was the largest shareholder of Tripadvisor Inc (NASDAQ:TRIP), with a stake worth $336.8 million reported as of the end of December. Trailing PAR Capital Management was Whale Rock Capital Management, which amassed a stake valued at $155.3 million. Renaissance Technologies, Polar Capital, and SoMa Equity Partners 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 PAR Capital Management allocated the biggest weight to Tripadvisor Inc (NASDAQ:TRIP), around 9.82% of its 13F portfolio. SoMa Equity Partners is also relatively very bullish on the stock, designating 2.09 percent of its 13F equity portfolio to TRIP.
As one would reasonably expect, some big names have jumped into Tripadvisor Inc (NASDAQ:TRIP) headfirst. Whale Rock Capital Management, managed by Alex Sacerdote, created the most outsized position in Tripadvisor Inc (NASDAQ:TRIP). Whale Rock Capital Management had $155.3 million invested in the company at the end of the quarter. David Fiszel’s Honeycomb Asset Management also initiated a $22.8 million position during the quarter. The other funds with new positions in the stock are Karthik Sarma’s SRS Investment Management, Dmitry Balyasny’s Balyasny Asset Management, and Chet Kapoor’s Tenzing Global Investors.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Tripadvisor Inc (NASDAQ:TRIP) but similarly valued. These stocks are Hawaiian Electric Industries, Inc. (NYSE:HE), DCP Midstream LP (NYSE:DCP), Black Hills Corporation (NYSE:BKH), Wyndham Destinations, Inc. (NYSE:WYND), Velodyne Lidar, Inc. (NASDAQ:VLDR), Safehold Inc. (NYSE:SAFE), and Companhia Brasileira de Distrib. (NYSE:CBD). This group of stocks’ market values are closest to TRIP’s market value.
|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 14.3 hedge funds with bullish positions and the average amount invested in these stocks was $149 million. That figure was $1085 million in TRIP’s case. Wyndham Destinations, Inc. (NYSE:WYND) is the most popular stock in this table. On the other hand DCP Midstream LP (NYSE:DCP) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks Tripadvisor Inc (NASDAQ:TRIP) is more popular among hedge funds. Our overall hedge fund sentiment score for TRIP is 88.6. 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 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 returned 5.3% in 2021 through March 19th but still managed to beat the market by 0.8 percentage points. Hedge funds were also right about betting on TRIP as the stock returned 108.4% since the end of December (through 3/19) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Disclosure: None. This article was originally published at Insider Monkey.