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 823 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 June 30th, when the S&P 500 Index was trading around the 3100 level. Stocks kept going up since then. In this article we look at how hedge funds traded Synaptics Incorporated (NASDAQ:SYNA) and determine whether the smart money was really smart about this stock.
Is Synaptics Incorporated (NASDAQ:SYNA) a cheap investment now? Prominent investors were becoming more confident. The number of long hedge fund positions moved up by 2 in recent months. Synaptics Incorporated (NASDAQ:SYNA) was in 28 hedge funds’ portfolios at the end of June. The all time high for this statistics is 26. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that SYNA isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks). There were 26 hedge funds in our database with SYNA holdings at the end of March.
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most traders, hedge funds are seen as unimportant, outdated financial tools of years past. While there are over 8000 funds with their doors open at present, We choose to focus on the bigwigs of this club, around 850 funds. These investment experts administer the majority of all hedge funds’ total capital, and by paying attention to their inimitable picks, Insider Monkey has formulated a few investment strategies that have historically outpaced Mr. Market. Insider Monkey’s flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. Our portfolio of short stocks lost 34% since February 2017 (through August 17th) even though the market was up 53% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Israel Englander of Millennium Management
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. We go through lists like the 10 most profitable companies in the world 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 to get excerpts of these letters in your inbox. With all of this in mind let’s take a look at the recent hedge fund action encompassing Synaptics Incorporated (NASDAQ:SYNA).
How have hedgies been trading Synaptics Incorporated (NASDAQ:SYNA)?
At second quarter’s end, a total of 28 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 8% from one quarter earlier. By comparison, 13 hedge funds held shares or bullish call options in SYNA a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Of the funds tracked by Insider Monkey, Ken Fisher’s Fisher Asset Management has the largest position in Synaptics Incorporated (NASDAQ:SYNA), worth close to $79.2 million, corresponding to 0.1% of its total 13F portfolio. Coming in second is Renaissance Technologies, which holds a $58.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedge funds and institutional investors that are bullish encompass D. E. Shaw’s D E Shaw, Cliff Asness’s AQR Capital Management and Israel Englander’s Millennium Management. In terms of the portfolio weights assigned to each position Greenhouse Funds allocated the biggest weight to Synaptics Incorporated (NASDAQ:SYNA), around 2.19% of its 13F portfolio. Arjuna Capital is also relatively very bullish on the stock, dishing out 0.55 percent of its 13F equity portfolio to SYNA.
As aggregate interest increased, key hedge funds have been driving this bullishness. Greenhouse Funds, managed by Joe Milano, initiated the most outsized position in Synaptics Incorporated (NASDAQ:SYNA). Greenhouse Funds had $14.7 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also made a $1.2 million investment in the stock during the quarter. The other funds with brand new SYNA positions are Farnum Brown and Adam Seitchik’s Arjuna Capital, Benjamin A. Smith’s Laurion Capital Management, and Qing Li’s Sciencast Management.
Let’s go over hedge fund activity in other stocks similar to Synaptics Incorporated (NASDAQ:SYNA). These stocks are Pacific Premier Bancorp, Inc. (NASDAQ:PPBI), Outfront Media Inc (NYSE:OUT), Tower Semiconductor Ltd. (NASDAQ:TSEM), Worthington Industries, Inc. (NYSE:WOR), CIT Group Inc. (NYSE:CIT), Enable Midstream Partners LP (NYSE:ENBL), and Washington Federal Inc. (NASDAQ:WAFD). This group of stocks’ market caps are closest to SYNA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PPBI | 11 | 75350 | 3 |
| OUT | 38 | 470016 | 8 |
| TSEM | 15 | 312269 | 4 |
| WOR | 21 | 77248 | 7 |
| CIT | 27 | 320526 | -10 |
| ENBL | 5 | 11040 | -1 |
| WAFD | 14 | 34823 | -4 |
| Average | 18.7 | 185896 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.7 hedge funds with bullish positions and the average amount invested in these stocks was $186 million. That figure was $320 million in SYNA’s case. Outfront Media Inc (NYSE:OUT) is the most popular stock in this table. On the other hand Enable Midstream Partners LP (NYSE:ENBL) is the least popular one with only 5 bullish hedge fund positions. Synaptics Incorporated (NASDAQ:SYNA) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SYNA is 71.8. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 21.3% in 2020 through September 25th and still beat the market by 17.7 percentage points. Hedge funds were also right about betting on SYNA as the stock returned 30.1% during Q3 (through September 25th) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
