Where Does The Smart Money Stand On Avis Budget Group Inc. (CAR)?

Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Avis Budget Group Inc. (NASDAQ:CAR) based on that data.

Is Avis Budget Group Inc. (NASDAQ:CAR) a safe investment right now? The smart money was reducing their bets on the stock. The number of bullish hedge fund positions shrunk by 1 lately. Avis Budget Group Inc. (NASDAQ:CAR) was in 26 hedge funds’ portfolios at the end of September. The all time high for this statistic is 44. Our calculations also showed that CAR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind we’re going to view the key hedge fund action surrounding Avis Budget Group Inc. (NASDAQ:CAR).

Do Hedge Funds Think CAR Is A Good Stock To Buy Now?

Heading into the fourth quarter of 2021, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -4% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CAR over the last 25 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, SRS Investment Management held the most valuable stake in Avis Budget Group Inc. (NASDAQ:CAR), which was worth $2147.4 million at the end of the third quarter. On the second spot was Two Sigma Advisors which amassed $96.6 million worth of shares. Citadel Investment Group, Millennium Management, and Driehaus 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 SRS Investment Management allocated the biggest weight to Avis Budget Group Inc. (NASDAQ:CAR), around 30.19% of its 13F portfolio. Calixto Global Investors is also relatively very bullish on the stock, earmarking 9.79 percent of its 13F equity portfolio to CAR.

Judging by the fact that Avis Budget Group Inc. (NASDAQ:CAR) has witnessed falling interest from the smart money, it’s safe to say that there is a sect of fund managers who were dropping their positions entirely heading into Q4. Intriguingly, Mark Coe’s Intrinsic Edge Capital dropped the largest position of the “upper crust” of funds monitored by Insider Monkey, valued at close to $16.4 million in stock. Brandon Haley’s fund, Holocene Advisors, also sold off its stock, about $12.6 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 1 funds heading into Q4.

Let’s now take a look at hedge fund activity in other stocks similar to Avis Budget Group Inc. (NASDAQ:CAR). These stocks are Huntington Ingalls Industries Inc (NYSE:HII), Olin Corporation (NYSE:OLN), EQT Corporation (NYSE:EQT), Globus Medical Inc (NYSE:GMED), US Foods Holding Corp. (NYSE:USFD), AerCap Holdings N.V. (NYSE:AER), and Kilroy Realty Corp (NYSE:KRC). All of these stocks’ market caps are similar to CAR’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 35.3 hedge funds with bullish positions and the average amount invested in these stocks was $769 million. That figure was $2464 million in CAR’s case. EQT Corporation (NYSE:EQT) is the most popular stock in this table. On the other hand Huntington Ingalls Industries Inc (NYSE:HII) is the least popular one with only 15 bullish hedge fund positions. Avis Budget Group Inc. (NASDAQ:CAR) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CAR is 34.8. 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 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. A small number of hedge funds were also right about betting on CAR as the stock returned 111.3% since the end of the third quarter (through 12/9) and outperformed the market by an even larger margin.

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Disclosure: None. This article was originally published at Insider Monkey.