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 have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider Spirit AeroSystems Holdings, Inc. (NYSE:SPR) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Spirit AeroSystems Holdings, Inc. (NYSE:SPR) investors should pay attention to an increase in enthusiasm from smart money of late. Spirit AeroSystems Holdings, Inc. (NYSE:SPR) was in 44 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 50. Our calculations also showed that SPR isn’t among the 30 most popular stocks among hedge funds (click for Q1 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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. 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 115 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
Daniel Och, Founder of OZ Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation, which is why we are checking out this inflation play. We go through lists like 10 best gold stocks to buy to identify promising stocks. 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 homepage. Keeping this in mind we’re going to take a gander at the recent hedge fund action encompassing Spirit AeroSystems Holdings, Inc. (NYSE:SPR).
Do Hedge Funds Think SPR Is A Good Stock To Buy Now?
At Q1’s end, a total of 44 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 7% from one quarter earlier. On the other hand, there were a total of 38 hedge funds with a bullish position in SPR a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Scopia Capital was the largest shareholder of Spirit AeroSystems Holdings, Inc. (NYSE:SPR), with a stake worth $209.5 million reported as of the end of March. Trailing Scopia Capital was OZ Management, which amassed a stake valued at $203.8 million. Marshall Wace LLP, Two Sigma Advisors, and Maple Rock 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 Scopia Capital allocated the biggest weight to Spirit AeroSystems Holdings, Inc. (NYSE:SPR), around 25.98% of its 13F portfolio. Crestwood Capital Management is also relatively very bullish on the stock, setting aside 8.42 percent of its 13F equity portfolio to SPR.
With a general bullishness amongst the heavyweights, key money managers were leading the bulls’ herd. Redwood Capital Management, managed by Jonathan Kolatch, created the biggest position in Spirit AeroSystems Holdings, Inc. (NYSE:SPR). Redwood Capital Management had $27.3 million invested in the company at the end of the quarter. Frank Fu’s CaaS Capital also initiated a $15.8 million position during the quarter. The following funds were also among the new SPR investors: Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors, Kevin D. Eng’s Columbus Hill Capital Management, and Peter Avellone’s Cartenna Capital.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Spirit AeroSystems Holdings, Inc. (NYSE:SPR) but similarly valued. We will take a look at AMC Entertainment Holdings Inc (NYSE:AMC), Acadia Healthcare Company Inc (NASDAQ:ACHC), Atea Pharmaceuticals, Inc. (NASDAQ:AVIR), Vontier Corporation (NYSE:VNT), Park Hotels & Resorts Inc. (NYSE:PK), CIT Group Inc. (NYSE:CIT), and Galapagos NV (NASDAQ:GLPG). All of these stocks’ market caps match SPR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AMC | 19 | 34006 | 3 |
| ACHC | 30 | 525135 | 1 |
| AVIR | 13 | 1296595 | -1 |
| VNT | 38 | 786836 | 2 |
| PK | 18 | 101472 | 5 |
| CIT | 28 | 802021 | -3 |
| GLPG | 20 | 167561 | 8 |
| Average | 23.7 | 530518 | 2.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.7 hedge funds with bullish positions and the average amount invested in these stocks was $531 million. That figure was $1120 million in SPR’s case. Vontier Corporation (NYSE:VNT) is the most popular stock in this table. On the other hand Atea Pharmaceuticals, Inc. (NASDAQ:AVIR) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks Spirit AeroSystems Holdings, Inc. (NYSE:SPR) is more popular among hedge funds. Our overall hedge fund sentiment score for SPR is 84.4. 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 17.4% in 2021 through June 18th and still beat the market by 6.1 percentage points. Unfortunately SPR wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on SPR were disappointed as the stock returned -0.1% since the end of the first quarter (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 most of these stocks already outperformed the market since 2019.
Follow Spirit Aerosystems Holdings Inc. (NYSE:SPR)
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Disclosure: None. This article was originally published at Insider Monkey.
