Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about PTC Inc (NASDAQ:PTC) in this article.
Is PTC a good stock to buy? PTC Inc (NASDAQ:PTC) investors should be aware of an increase in enthusiasm from smart money of late. PTC Inc (NASDAQ:PTC) was in 37 hedge funds' portfolios at the end of the third quarter of 2021. The all time high for this statistic is 46. Our calculations also showed that PTC 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 let's take a peek at the latest hedge fund action regarding PTC Inc (NASDAQ:PTC).
Paul Marshall of Marshall Wace
Do Hedge Funds Think PTC Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 19% from one quarter earlier. By comparison, 39 hedge funds held shares or bullish call options in PTC 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.
More specifically, Impax Asset Management was the largest shareholder of PTC Inc (NASDAQ:PTC), with a stake worth $481.2 million reported as of the end of September. Trailing Impax Asset Management was 40 North Management, which amassed a stake valued at $382.4 million. Alkeon Capital Management, Praesidium Investment Management Company, and Two Creeks Capital 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 40 North Management allocated the biggest weight to PTC Inc (NASDAQ:PTC), around 11.79% of its 13F portfolio. StackLine Partners is also relatively very bullish on the stock, setting aside 11.5 percent of its 13F equity portfolio to PTC.
Consequently, key money managers have been driving this bullishness. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, initiated the most valuable position in PTC Inc (NASDAQ:PTC). Marshall Wace LLP had $49.3 million invested in the company at the end of the quarter. John Overdeck and David Siegel's Two Sigma Advisors also made a $41.6 million investment in the stock during the quarter. The other funds with new positions in the stock are D. E. Shaw's D E Shaw, Michael Lowenstein's Kensico Capital, and Ken Griffin's Citadel Investment Group.
Let's go over hedge fund activity in other stocks similar to PTC Inc (NASDAQ:PTC). We will take a look at Cardinal Health, Inc. (NYSE:CAH), Clarivate Plc (NYSE:CLVT), Alliant Energy Corporation (NASDAQ:LNT), Zendesk Inc (NYSE:ZEN), News Corp (NASDAQ:NWSA), Loews Corporation (NYSE:L), and Solaredge Technologies Inc (NASDAQ:SEDG). This group of stocks' market caps match PTC's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CAH,36,664971,-4 CLVT,32,4723546,-9 LNT,17,76693,1 ZEN,53,1557704,1 NWSA,34,737689,-3 L,27,175121,-1 SEDG,33,594467,-4 Average,33.1,1218599,-2.7 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.1 hedge funds with bullish positions and the average amount invested in these stocks was $1219 million. That figure was $1820 million in PTC's case. Zendesk Inc (NYSE:ZEN) is the most popular stock in this table. On the other hand Alliant Energy Corporation (NASDAQ:LNT) is the least popular one with only 17 bullish hedge fund positions. PTC Inc (NASDAQ:PTC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for PTC is 61.9. 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 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately PTC wasn't nearly as popular as these 5 stocks and hedge funds that were betting on PTC were disappointed as the stock returned -8.5% since the end of September (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 many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.