The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards National Vision Holdings, Inc. (NASDAQ:EYE).
Is National Vision Holdings, Inc. (NASDAQ:EYE) the right pick for your portfolio? Investors who are in the know were getting more optimistic. The number of long hedge fund positions rose by 1 lately. National Vision Holdings, Inc. (NASDAQ:EYE) was in 18 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 25. Our calculations also showed that EYE isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
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. 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 66 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
At Insider Monkey we scour multiple sources to uncover 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 and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks 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. Now let’s review the fresh hedge fund action regarding National Vision Holdings, Inc. (NASDAQ:EYE).
Do Hedge Funds Think EYE Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 6% from the previous quarter. The graph below displays the number of hedge funds with bullish position in EYE over the last 21 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Adage Capital Management held the most valuable stake in National Vision Holdings, Inc. (NASDAQ:EYE), which was worth $304.2 million at the end of the third quarter. On the second spot was Columbus Circle Investors which amassed $16.3 million worth of shares. Millennium Management, D E Shaw, and Impax Asset Management 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 Adage Capital Management allocated the biggest weight to National Vision Holdings, Inc. (NASDAQ:EYE), around 0.76% of its 13F portfolio. Columbus Circle Investors is also relatively very bullish on the stock, setting aside 0.71 percent of its 13F equity portfolio to EYE.
Now, some big names have been driving this bullishness. Millennium Management, managed by Israel Englander, assembled the most outsized position in National Vision Holdings, Inc. (NASDAQ:EYE). Millennium Management had $14.2 million invested in the company at the end of the quarter. Noam Gottesman’s GLG Partners also made a $0.7 million investment in the stock during the quarter. The other funds with brand new EYE positions are Mika Toikka’s AlphaCrest Capital Management, Qing Li’s Sciencast Management, and Donald Sussman’s Paloma Partners.
Let’s also examine hedge fund activity in other stocks similar to National Vision Holdings, Inc. (NASDAQ:EYE). We will take a look at Altair Engineering Inc. (NASDAQ:ALTR), The Ensign Group, Inc. (NASDAQ:ENSG), Millicom International Cellular S.A. (NASDAQ:TIGO), Artisan Partners Asset Management Inc (NYSE:APAM), Glacier Bancorp, Inc. (NASDAQ:GBCI), Popular Inc (NASDAQ:BPOP), and ACI Worldwide Inc (NASDAQ:ACIW). This group of stocks’ market caps are similar to EYE’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $251 million. That figure was $361 million in EYE’s case. Popular Inc (NASDAQ:BPOP) is the most popular stock in this table. On the other hand Millicom International Cellular S.A. (NASDAQ:TIGO) is the least popular one with only 8 bullish hedge fund positions. National Vision Holdings, Inc. (NASDAQ:EYE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for EYE is 50.3. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. A small number of hedge funds were also right about betting on EYE as the stock returned 19.2% since the end of the third quarter (through 12/14) and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.