Is WSC A Good Stock To Buy According To Hedge Funds?

Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC).

Is WSC a good stock to buy? Hedge funds were taking an optimistic view. The number of bullish hedge fund positions rose by 5 recently. WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC) was in 36 hedge funds’ portfolios at the end of September. The all time high for this statistic is 31. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that WSC 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 tons of gauges stock market investors put to use to size up their stock investments. Two of the best gauges are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the best picks of the best money managers can outpace their index-focused peers by a significant amount (see the details here).

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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 15 best blue chip stocks to buy 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 we’re going to check out the fresh hedge fund action encompassing WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC).

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

Heading into the fourth quarter of 2020, a total of 36 of the hedge funds tracked by Insider Monkey were long this stock, a change of 16% from the previous quarter. The graph below displays the number of hedge funds with bullish position in WSC over the last 21 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, Permian Investment Partners held the most valuable stake in WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC), which was worth $98 million at the end of the third quarter. On the second spot was Broad Bay Capital which amassed $67.7 million worth of shares. Rubric Capital Management, Bayberry Capital Partners, and Dendur 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 Permian Investment Partners allocated the biggest weight to WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC), around 19.27% of its 13F portfolio. Dendur Capital is also relatively very bullish on the stock, setting aside 13 percent of its 13F equity portfolio to WSC.

As industrywide interest jumped, specific money managers were breaking ground themselves. Permian Investment Partners, managed by Alex Duran and Scott Hendrickson, created the most valuable position in WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC). Permian Investment Partners had $98 million invested in the company at the end of the quarter. Richard Scott Greeder’s Broad Bay Capital also made a $67.7 million investment in the stock during the quarter. The following funds were also among the new WSC investors: David Rosen’s Rubric Capital Management, Angela Aldrich’s Bayberry Capital Partners, and Malcolm Levine’s Dendur Capital.

Let’s check out hedge fund activity in other stocks similar to WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC). These stocks are Denali Therapeutics Inc. (NASDAQ:DNLI), Grand Canyon Education Inc (NASDAQ:LOPE), World Wrestling Entertainment, Inc. (NYSE:WWE), Carter’s, Inc. (NYSE:CRI), ChemoCentryx Inc (NASDAQ:CCXI), RLI Corp. (NYSE:RLI), and Harley-Davidson, Inc. (NYSE:HOG). This group of stocks’ market values are closest to WSC’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DNLI 24 121637 3
LOPE 32 193579 -3
WWE 27 389033 -2
CRI 26 222410 -7
CCXI 27 641967 -4
RLI 22 183815 2
HOG 32 490737 2
Average 27.1 320454 -1.3

View table here if you experience formatting issues.

As you can see these stocks had an average of 27.1 hedge funds with bullish positions and the average amount invested in these stocks was $320 million. That figure was $574 million in WSC’s case. Grand Canyon Education Inc (NASDAQ:LOPE) is the most popular stock in this table. On the other hand RLI Corp. (NYSE:RLI) is the least popular one with only 22 bullish hedge fund positions. Compared to these stocks WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC) is more popular among hedge funds. Our overall hedge fund sentiment score for WSC is 90. 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 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 returned 33.3% in 2020 through December 18th but still managed to beat the market by 16.4 percentage points. Hedge funds were also right about betting on WSC as the stock returned 33.3% since the end of September (through 12/18) 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.

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