The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 866 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article we look at what those investors think of Lennar Corporation (NYSE:LEN).
Lennar Corporation (NYSE:LEN) has experienced a decrease in support from the world’s most elite money managers recently. Lennar Corporation (NYSE:LEN) was in 49 hedge funds’ portfolios at the end of March. The all time high for this statistic is 66. Our calculations also showed that LEN isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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Ricky Sandler of Eminence Capital
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Do Hedge Funds Think LEN Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 49 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -6% from the fourth quarter of 2020. The graph below displays the number of hedge funds with bullish position in LEN over the last 23 quarters. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
Among these funds, Greenhaven Associates held the most valuable stake in Lennar Corporation (NYSE:LEN), which was worth $711.2 million at the end of the fourth quarter. On the second spot was Eminence Capital which amassed $108.8 million worth of shares. Fisher Asset Management, AQR Capital Management, and GAMCO Investors 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 Greenhaven Associates allocated the biggest weight to Lennar Corporation (NYSE:LEN), around 16.07% of its 13F portfolio. Third Avenue Management is also relatively very bullish on the stock, dishing out 5.25 percent of its 13F equity portfolio to LEN.
Because Lennar Corporation (NYSE:LEN) has witnessed bearish sentiment from the smart money, logic holds that there lies a certain “tier” of funds who were dropping their full holdings in the first quarter. Interestingly, Patrick Degorce’s Theleme Partners dumped the largest investment of the 750 funds monitored by Insider Monkey, worth close to $105 million in stock. Renaissance Technologies, also sold off its stock, about $42.8 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 3 funds in the first quarter.
Let’s also examine hedge fund activity in other stocks similar to Lennar Corporation (NYSE:LEN). We will take a look at Teladoc Health, Inc (NYSE:TDOC), The Kroger Co. (NYSE:KR), American Water Works Company, Inc. (NYSE:AWK), Ameriprise Financial, Inc. (NYSE:AMP), Tyson Foods, Inc. (NYSE:TSN), RingCentral Inc (NYSE:RNG), and Mettler-Toledo International Inc. (NYSE:MTD). This group of stocks’ market values resemble LEN’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TDOC | 42 | 3372133 | -8 |
| KR | 35 | 3155231 | -1 |
| AWK | 30 | 1109517 | -6 |
| AMP | 37 | 969834 | 3 |
| TSN | 28 | 761852 | -10 |
| RNG | 51 | 3249906 | -12 |
| MTD | 27 | 1040369 | -2 |
| Average | 35.7 | 1951263 | -5.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 35.7 hedge funds with bullish positions and the average amount invested in these stocks was $1951 million. That figure was $1570 million in LEN’s case. RingCentral Inc (NYSE:RNG) is the most popular stock in this table. On the other hand Mettler-Toledo International Inc. (NYSE:MTD) is the least popular one with only 27 bullish hedge fund positions. Lennar Corporation (NYSE:LEN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LEN is 70.1. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 17.4% in 2021 through June 18th and beat the market again by 6.1 percentage points. Unfortunately LEN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on LEN were disappointed as the stock returned -2.8% since the end of March (through 6/18) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
Follow Lennar Corp W (NYSE:LEN, LEN.B)
Follow Lennar Corp W (NYSE:LEN, LEN.B)
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Disclosure: None. This article was originally published at Insider Monkey.
