What Do Hedge Funds Think of Qorvo Inc (QRVO)?

Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Micron and Anadarko Petroleum, have not done well during the last 12 months ending in October due to various reasons. Nevertheless, the data show elite investors’ consensus picks have done well on average. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last four quarters ending in October and sixty three percent of these 30 stocks outperformed the market. S&P 500 Index returned only 5.2% during the same period and less than 49% of its constituents managed to beat this return. Because their consensus picks have done well, we pay attention to what elite funds think before doing extensive research on a stock. In this article, we take a closer look at Qorvo Inc (NASDAQ:QRVO) from the perspective of those elite funds.

Is Qorvo Inc (NASDAQ:QRVO) an outstanding investment right now? Hedge funds are taking a bearish view. The number of long hedge fund bets went down by 7 lately. QRVO was in 27 hedge funds’ portfolios at the end of the third quarter of 2015. There were 34 hedge funds in our database with QRVO holdings at the end of the previous quarter. At the end of this article we will also compare QRVO to other stocks including Hyatt Hotels Corporation (NYSE:H), ONEOK, Inc. (NYSE:OKE), and W.R. Grace & Co. (NYSE:GRA) to get a better sense of its popularity.

Now, let’s take a look at the key action surrounding Qorvo Inc (NASDAQ:QRVO).

Hedge fund activity in Qorvo Inc (NASDAQ:QRVO)

At the end of the third quarter, a total of 27 of the hedge funds tracked by Insider Monkey were long this stock, a change of -21% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Roystone Capital Partners, managed by Richard Barrera, holds the number one position in Qorvo Inc (NASDAQ:QRVO). Roystone Capital Partners has a $124.3 million position in the stock, comprising 5.9% of its 13F portfolio. The second most bullish fund manager is Fisher Asset Management, led by Ken Fisher, holding a $49.2 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining professional money managers with similar optimism comprise Ken Griffin’s Citadel Investment Group, Israel Englander’s Millennium Management and Alex Sacerdote’s Whale Rock Capital Management.

Due to the fact that Qorvo Inc (NASDAQ:QRVO) has experienced a declination in interest from the aggregate hedge fund industry, it’s safe to say that there was a specific group of money managers that elected to cut their full holdings in the third quarter. Interestingly, Dmitry Balyasny’s Balyasny Asset Management dropped the largest position of the “upper crust” of funds followed by Insider Monkey, totaling an estimated $81.6 million in stock, and Jason Karp’s Tourbillon Capital Partners was right behind this move, as the fund dumped about $64.2 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest fell by 7 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks similar to Qorvo Inc (NASDAQ:QRVO). We will take a look at Hyatt Hotels Corporation (NYSE:H), ONEOK, Inc. (NYSE:OKE), W.R. Grace & Co. (NYSE:GRA), and W.R. Berkley Corporation (NYSE:WRB). All of these stocks’ market caps match QRVO’s market cap.

As you can see these stocks had an average of 27.25 hedge funds with bullish positions and the average amount invested in these stocks was $1067 million. That figure was $389 million in QRVO’s case. W.R. Grace & Co. (NYSE:GRA) is the most popular stock in this table. On the other hand Hyatt Hotels Corporation (NYSE:H) is the least popular one with only 20 bullish hedge fund positions. Qorvo Inc (NASDAQ:QRVO) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard GRA might be a better candidate to consider a long position.