After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Five9 Inc (NASDAQ:FIVN).
Five9 Inc (NASDAQ:FIVN) was in 76 hedge funds' portfolios at the end of the third quarter of 2021. The all time high for this statistic was previously 47. This means the bullish number of hedge fund positions in this stock currently sits at its new all time high. FIVN investors should be aware of an increase in hedge fund sentiment recently. There were 45 hedge funds in our database with FIVN positions at the end of the second quarter. Our calculations also showed that FIVN 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. Now we're going to take a peek at the fresh hedge fund action encompassing Five9 Inc (NASDAQ:FIVN).
Gil Simon of SoMa Equity Partners
Do Hedge Funds Think FIVN Is A Good Stock To Buy Now?
At the end of September, a total of 76 of the hedge funds tracked by Insider Monkey were long this stock, a change of 69% from the previous quarter. On the other hand, there were a total of 47 hedge funds with a bullish position in FIVN a year ago. With hedge funds' sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
The largest stake in Five9 Inc (NASDAQ:FIVN) was held by Alkeon Capital Management, which reported holding $480.7 million worth of stock at the end of September. It was followed by Whale Rock Capital Management with a $367.7 million position. Other investors bullish on the company included Corvex Capital, Pentwater Capital Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Calixto Global Investors allocated the biggest weight to Five9 Inc (NASDAQ:FIVN), around 15.11% of its 13F portfolio. Parsifal Capital Management is also relatively very bullish on the stock, dishing out 7.3 percent of its 13F equity portfolio to FIVN.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls' herd. Corvex Capital, managed by Keith Meister, established the largest call position in Five9 Inc (NASDAQ:FIVN). Corvex Capital had $199.7 million invested in the company at the end of the quarter. Matthew Halbower's Pentwater Capital Management also made a $198.9 million investment in the stock during the quarter. The other funds with new positions in the stock are Keith Meister's Corvex Capital, Simon Sadler's Segantii Capital, and Gil Simon's SoMa Equity Partners.
Let's check out hedge fund activity in other stocks similar to Five9 Inc (NASDAQ:FIVN). These stocks are Dr. Reddy's Laboratories Limited (NYSE:RDY), Comerica Incorporated (NYSE:CMA), Marathon Oil Corporation (NYSE:MRO), Teva Pharmaceutical Industries Limited (NYSE:TEVA), Booz Allen Hamilton Holding Corporation (NYSE:BAH), StoneCo Ltd. (NASDAQ:STNE), and Builders FirstSource, Inc. (NYSE:BLDR). All of these stocks' market caps resemble FIVN's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position RDY,12,172681,1 CMA,31,644935,-2 MRO,40,903222,6 TEVA,22,950696,0 BAH,23,198716,-6 STNE,37,2215793,-7 BLDR,53,2213103,-7 Average,31.1,1042735,-2.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 31.1 hedge funds with bullish positions and the average amount invested in these stocks was $1043 million. That figure was $3598 million in FIVN's case. Builders FirstSource, Inc. (NYSE:BLDR) is the most popular stock in this table. On the other hand Dr. Reddy's Laboratories Limited (NYSE:RDY) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Five9 Inc (NASDAQ:FIVN) is more popular among hedge funds. Our overall hedge fund sentiment score for FIVN is 90. 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Unfortunately FIVN wasn't nearly as popular as these 5 stocks and hedge funds that were betting on FIVN were disappointed as the stock returned -10.9% since the end of the third quarter (through 11/30) 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.
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Disclosure: None. This article was originally published at Insider Monkey.