Where are the hedge funds located on Vista Outdoor Inc (VSTO)?
Our extensive research has shown that emulating smart money can generate significant returns for retail investors, which is why we follow nearly 900 active top fund managers and analyze their 13F quarterly returns. Stocks that are heavily bought by hedge funds have historically outperformed the market, although there is no shortage of high profile defaults, such as the 2018 hedge fund losses on Facebook and Apple. Let’s take a closer look at what the funds we track think of Vista Outdoor Inc (NYSE:VSTO) in this article.
Vista Outdoor Inc (NYSE:VSTO) has seen an increase in interest from hedge funds in recent months. Vista Outdoor Inc (NYSE:VSTO) appeared in 24 hedge fund portfolios at the end of June. The all-time high for this statistic is 28. Our calculations have also shown that VSTO is not among the 30 most popular stocks among hedge funds (click for Q2 ranking).
The reputation of hedge funds as savvy investors has been tarnished over the past decade, as their hedged returns could not keep up with the unhedged returns of stock indices. Hedge funds have over $ 3.5 trillion in assets under management, so you can’t expect all of their portfolios to beat the market with significant margins. Our research identified in advance a select group of hedge funds that have outperformed S&P 500 ETFs by more than 79 percentage points since March 2017 (see details here). So you can still find a lot of gems by following the movements of hedge funds today.
Ryan Tolkin, CIO of Schonfeld Strategic Advisors
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Do hedge funds think VSTO is a good stock to buy now?
At the end of June, 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 9% from the previous quarter. By comparison, 22 hedge funds held bullish stocks or call options in VSTO a year ago. With the whirlwind of hedge fund sentiment, there is a “top tier” of notable hedge fund managers who were significantly increasing their stakes (or already building up significant positions).
According to the Insider Monkey hedge fund database, Gates Capital Management, managed by Jeffrey Gates, holds the most valuable position in Vista Outdoor Inc (NYSE: VSTO). Gates Capital Management holds a position of $ 193.5 million in the stock, or 5.6% of its 13F portfolio. Second is Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, which has a position of $ 49 million; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers who hold long positions include Joe Milano’s Greenhouse Fund, Renaissance Technologies and Driehaus Capital by Richard Driehaus. In terms of the portfolio weights assigned to each position, Mountain Lake Investment Management assigned the largest weight to Vista Outdoor Inc (NYSE: VSTO), approximately 5.75% of its 13F portfolio. Gates Capital Management is also relatively very bullish on the stock, allocating 5.58% of its 13F equity portfolio to VSTO.
Now, the major hedge funds have launched into Vista Outdoor Inc (NYSE: VSTO) headlong. SG Capital Management, managed by Ken Grossman and Glen Schneider, gathered the largest position in Vista Outdoor Inc (NYSE: VSTO). SG Capital Management had $ 5.2 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also invested $ 2.4 million in the stock during the quarter. The following funds were also among the new VSTO investors: Schonfeld Strategic Advisors by Ryan Tolkin (CIO), ExodusPoint Capital by Michael Gelband and Noam Gottesman GLG Partners.
Let’s also look at hedge fund activity in other stocks – not necessarily in the same industry as Vista Outdoor Inc (NYSE: VSTO) but of similar value. We’ll take a look at Perficient, Inc. (NASDAQ:PRFT), NovaGold Resources Inc. (NYSE:NG), Minerals Technologies Inc (NYSE:MTX), Constellium SE (NYSE:MSTC), Allegheny Technologies Incorporated (NYSE:ATI), Microvision, Inc. (NASDAQ:MVIS) and Crescent Point Energy Corp (NYSE:GIC). The market capitalizations of this group of stocks are closest to the market capitalization of VSTO.
[table] Ticker, number of HF with positions, total value of HF positions (x1000), change of HF position PRFT, 18.108591, -4 NG, 18.292068.3 MTX, 10.101131.1 CSTM, 28.365340, – 8 ATI, 28.269671.8 MVIS, 11.68467, -1 CPG, 13.105057.0 Average, 18.187189, -0.1 [/table]
See the table here if you have formatting problems.
As you can see, these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $ 187 million. That figure was $ 409 million in the case of VSTO. Constellium SE (NYSE:MSTC) is the most popular action in this table. On the other hand, Minerals Technologies Inc (NYSE:MTX) is the least popular with only 10 bullish hedge fund positions. Vista Outdoor Inc (NYSE: VSTO) isn’t the most popular stock in this group, but hedge fund interest is still above average. Our overall hedge fund sentiment score for VSTO is 71.6. Stocks with a 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 prefer to spend our time researching the stocks on which hedge funds are accumulating. Our calculations have shown 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% in 2021 through October 22 and again beat the market by 1.6 percentage points. Unfortunately, VSTO was not as popular as these 5 stocks and the hedge funds that bet on VSTO were disappointed as the stock has returned -5.4% since the end of June (through 10/22) and has under- performed the market. If you want to invest 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 have already outperformed the market since 2019.
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Disclosure: none. This article originally appeared on Monkey initiate.