Do Hedge Funds Love Digitalbridge Group Inc (DBRG)?

·6 min read

We at Insider Monkey have gone over 873 13F filings that hedge funds and prominent investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of June 30th. In this article, we look at what those funds think of Digitalbridge Group Inc (NYSE:DBRG) based on that data.

Digitalbridge Group Inc (NYSE:DBRG) investors should be aware of an increase in support from the world's most elite money managers lately. Digitalbridge Group Inc (NYSE:DBRG) was in 29 hedge funds' portfolios at the end of June. The all time high for this statistic is 36. There were 25 hedge funds in our database with DBRG holdings at the end of March. Our calculations also showed that DBRG isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).

Today there are dozens of indicators stock traders use to assess stocks. Some of the most under-the-radar indicators are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the best picks of the best investment managers can outclass the S&P 500 by a healthy amount (see the details here). Also, our monthly newsletter's portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.

Charles Akre Akre Capital Management
Charles Akre Akre Capital Management

Charles Akre of Akre Capital Management

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 homepage. Keeping this in mind let's go over the key hedge fund action surrounding Digitalbridge Group Inc (NYSE:DBRG).

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

Heading into the third quarter of 2021, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 16% from one quarter earlier. On the other hand, there were a total of 16 hedge funds with a bullish position in DBRG a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Digitalbridge Group Inc (NYSE:DBRG) was held by Baupost Group, which reported holding $180.7 million worth of stock at the end of June. It was followed by Iridian Asset Management with a $119.1 million position. Other investors bullish on the company included Legion Partners Asset Management, Akre Capital Management, and Two Sigma Advisors. In terms of the portfolio weights assigned to each position Legion Partners Asset Management allocated the biggest weight to Digitalbridge Group Inc (NYSE:DBRG), around 19.01% of its 13F portfolio. MIC Capital Partners is also relatively very bullish on the stock, earmarking 3.7 percent of its 13F equity portfolio to DBRG.

As one would reasonably expect, some big names have jumped into Digitalbridge Group Inc (NYSE:DBRG) headfirst. MIG Capital, managed by Richard Merage, assembled the largest position in Digitalbridge Group Inc (NYSE:DBRG). MIG Capital had $20.4 million invested in the company at the end of the quarter. Michael Gelband's ExodusPoint Capital also initiated a $1.1 million position during the quarter. The other funds with new positions in the stock are Ryan Tolkin (CIO)'s Schonfeld Strategic Advisors, Matthew Hulsizer's PEAK6 Capital Management, and Benjamin A. Smith's Laurion Capital Management.

Let's check out hedge fund activity in other stocks similar to Digitalbridge Group Inc (NYSE:DBRG). These stocks are Editas Medicine, Inc. (NASDAQ:EDIT), Eastern Bankshares, Inc. (NASDAQ:EBC), Denbury Inc. (NYSE:DEN), Southwest Gas Holdings, Inc. (NYSE:SWX), Southwestern Energy Company (NYSE:SWN), Turning Point Therapeutics, Inc. (NASDAQ:TPTX), and Dillard's, Inc. (NYSE:DDS). All of these stocks' market caps are closest to DBRG's market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EDIT,23,506626,-1 EBC,20,115205,6 DEN,29,996614,-1 SWX,19,145257,-4 SWN,27,257726,5 TPTX,28,646677,-5 DDS,18,91497,5 Average,23.4,394229,0.7 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 23.4 hedge funds with bullish positions and the average amount invested in these stocks was $394 million. That figure was $687 million in DBRG's case. Denbury Inc. (NYSE:DEN) is the most popular stock in this table. On the other hand Dillard's, Inc. (NYSE:DDS) is the least popular one with only 18 bullish hedge fund positions. Digitalbridge Group Inc (NYSE:DBRG) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for DBRG is 83.2. 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. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. 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 24.9% in 2021 through October 15th and beat the market again by 4.5 percentage points. Unfortunately DBRG wasn't nearly as popular as these 5 stocks and hedge funds that were betting on DBRG were disappointed as the stock returned -14.8% since the end of June (through 10/15) 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 many of these stocks already outperformed the market since 2019.

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

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