Hedge Funds Warming Up To Experience Investment Corp. (EXPC)

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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 first 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 4.5 years and analyze what the smart money thinks of Experience Investment Corp. (NASDAQ:EXPC) based on that data.

Is Experience Investment Corp. (NASDAQ:EXPC) undervalued? The smart money is buying. The number of long hedge fund positions inched up by 9 recently. Our calculations also showed that EXPC isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). EXPC was in 14 hedge funds’ portfolios at the end of the first quarter of 2020. There were 5 hedge funds in our database with EXPC holdings at the end of the previous quarter. Video: Watch our video about the top 5 most popular hedge fund stocks.

At the moment there are tons of gauges market participants put to use to grade stocks. Two of the most underrated gauges are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the best picks of the elite hedge fund managers can trounce the S&P 500 by a solid margin (see the details here).

Paul Glazer of Glazer Capital

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Paul Glazer of Glazer Capital

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology’s influence will go beyond online payments. So, we are checking out this futurist’s moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to go over the recent hedge fund action encompassing Experience Investment Corp. (NASDAQ:EXPC).

How are hedge funds trading Experience Investment Corp. (NASDAQ:EXPC)?

Heading into the second quarter of 2020, a total of 14 of the hedge funds tracked by Insider Monkey were long this stock, a change of 180% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards EXPC over the last 18 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

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According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Glazer Capital, managed by Paul Glazer, holds the biggest position in Experience Investment Corp. (NASDAQ:EXPC). Glazer Capital has a $21.3 million position in the stock, comprising 1.4% of its 13F portfolio. Coming in second is Isaac Corre of Governors Lane, with a $15.5 million position; the fund has 2.1% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions include Israel Englander’s Millennium Management, David Costen Haley’s HBK Investments and Steven Clark’s Omni Partners. In terms of the portfolio weights assigned to each position Governors Lane allocated the biggest weight to Experience Investment Corp. (NASDAQ:EXPC), around 2.15% of its 13F portfolio. Fort Baker Capital Management is also relatively very bullish on the stock, earmarking 1.44 percent of its 13F equity portfolio to EXPC.

As industrywide interest jumped, specific money managers were leading the bulls’ herd. Omni Partners, managed by Steven Clark, assembled the biggest position in Experience Investment Corp. (NASDAQ:EXPC). Omni Partners had $7.2 million invested in the company at the end of the quarter. Richard Driehaus’s Driehaus Capital also initiated a $5.8 million position during the quarter. The other funds with new positions in the stock are Jeffrey Tannenbaum’s Fir Tree, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners, and Sander Gerber’s Hudson Bay Capital Management.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Experience Investment Corp. (NASDAQ:EXPC) but similarly valued. These stocks are Sorrento Therapeutics Inc (NASDAQ:SRNE), Syndax Pharmaceuticals, Inc. (NASDAQ:SNDX), Puma Biotechnology Inc (NASDAQ:PBYI), and Betterware de Mexico, S.A.P.I. de C.V. (NASDAQ:BWMX). All of these stocks’ market caps match EXPC’s market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SRNE,5,10319,0 SNDX,19,74473,8 PBYI,20,100494,3 BWMX,2,622,2 Average,11.5,46477,3.25 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 11.5 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $89 million in EXPC’s case. Puma Biotechnology Inc (NASDAQ:PBYI) is the most popular stock in this table. On the other hand Betterware de Mexico, S.A.P.I. de C.V. (NASDAQ:BWMX) is the least popular one with only 2 bullish hedge fund positions. Experience Investment Corp. (NASDAQ:EXPC) is not the most popular stock in this group but hedge fund interest is still above average. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but beat the market by 16.8 percentage points. Unfortunately EXPC wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on EXPC were disappointed as the stock returned 3.7% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.

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

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