Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds and investors’ positions as of the end of the third quarter. You can find write-ups 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 and analyze what the smart money thinks of Nelnet, Inc. (NYSE:NNI) based on that data.
Nelnet, Inc. (NYSE:NNI) has seen an increase in hedge fund sentiment of late. NNI was in 21 hedge funds’ portfolios at the end of September. There were 18 hedge funds in our database with NNI positions at the end of the previous quarter. At the end of this article we will also compare NNI to other stocks including Allegheny Technologies Incorporated (NYSE:ATI), Intersil Corp (NASDAQ:ISIL), and Chesapeake Lodging Trust (NYSE:CHSP) to get a better sense of its popularity.
In the eyes of most stock holders, hedge funds are assumed to be underperforming, outdated financial tools of years past. While there are more than 8,000 funds trading today, we hone in on the crème de la crème of this group, approximately 700 funds. Most estimates calculate that this group of people command the lion’s share of the hedge fund industry’s total asset base, and by tracking their inimitable investments, Insider Monkey has found many investment strategies that have historically outrun the broader indices. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, we’re going to take a look at the fresh action regarding Nelnet, Inc. (NYSE:NNI).
What have hedge funds been doing with Nelnet, Inc. (NYSE:NNI)?
Heading into Q4, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a 17% increase from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes considerably (or had already accumulated large positions).
According to Insider Monkey’s hedge fund database, Seawolf Capital, managed by Porter Collins, Daniel Moses, and Vincent Daniel, holds the most valuable position in Nelnet, Inc. (NYSE:NNI). Seawolf Capital has a $22.7 million position in the stock, comprising 5.7% of its 13F portfolio. The second-most bullish fund manager is Millennium Management, led by Israel Englander, holding a $21.4 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions comprise Joe Huber’s Huber Capital Management, Ken Griffin’s Citadel Investment Group, and Renaissance Technologies, founded by Jim Simons.
Now, some big names were breaking ground themselves. Nine Chapters Capital Management, managed by Chao Ku, initiated the biggest position in Nelnet, Inc. (NYSE:NNI). Nine Chapters Capital Management had $1 million invested in the company at the end of the quarter. Peter Muller’s PDT Partners also initiated a $0.5 million position during the quarter. The following funds were also among the new NNI investors: David Costen Haley’s HBK Investments, and Paul Tudor Jones’ Tudor Investment Corp.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Nelnet, Inc. (NYSE:NNI) but similarly valued. We will take a look at Allegheny Technologies Incorporated (NYSE:ATI), Intersil Corp (NASDAQ:ISIL), Chesapeake Lodging Trust (NYSE:CHSP), and Monogram Residential Trust Inc (NYSE:MORE). This group of stocks’ market valuations resemble NNI’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $69 million. That figure was $117 million in NNI’s case. Allegheny Technologies Incorporated (NYSE:ATI) is the most popular stock in this table. On the other hand Monogram Residential Trust Inc (NYSE:MORE) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Nelnet, Inc. (NYSE:NNI) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.