In this article, we’ll look at how hedge fund sentiment is evolving towards Playa Hotels & Resorts NV (NASDAQ:PLYA) and decide if it’s a good investment now. At Insider Monkey, we love to research what billionaires and hedge funds think of a company before spending days researching it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and receive tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds sometimes do poorly, but their consensus decisions have outperformed the market after risk adjustments in the past.
Playa Hotels & Resorts NV (NASDAQ:PLYA) has recently seen increasing support from the world’s most elite wealth managers. Playa Hotels & Resorts NV (NASDAQ:PLYA) was in 26 hedge fund portfolios at the end of March. The all-time high for this statistic was previously 25. This means the bullish number of hedge fund positions in this stock is currently at its all-time high. At the end of the fourth quarter, there were 23 hedge funds in our database with PLYA positions. Our calculations have also shown that PLYA is not one of the The 30 most popular stocks among hedge funds (Click for the Q1 ranking).
Why do we even pay attention to the sentiment of hedge funds? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). Because of this, we believe that hedge fund sentiment is an extremely useful indicator that investors should look out for.
Parag Vora – HG Vora Capital
Parag Vora from HG Vora Capital Management
At Insider Monkey, we search multiple sources to discover the next great investment idea. Economists, for example, warn of a flare-up in inflation. So, we’re checking out that back door gold game that has reached peak profits of 718% in just over a year. We go lists like 10. by best battery stocks to pick the next Tesla that delivers a 10x return. While we recommend positions in just a tiny fraction of the companies we analyze, we review as many stocks as possible. We read letters from hedge fund investors and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. With this in mind, let’s take a look at the new hedge fund promotion regarding Playa Hotels & Resorts NV (NASDAQ:PLYA).
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Do hedge funds think PLYA is a good stock to buy now?
At the end of the first quarter, a total of 26 of the hedge funds tracked by Insider Monkey were long on this stock, a change of 13% compared to the previous quarter. The following graph shows the number of hedge funds with a bullish position in PLYA over the past 23 quarters. As smart money positions go through their usual ups and downs, there is an “upper tier” of key hedge fund managers who have increased their stakes significantly (or have already accumulated large positions).
Of the funds tracked by Insider Monkey, Farallon Capital has the largest position in Playa Hotels & Resorts NV (NASDAQ: PLYA) valued at nearly $ 109.5 million, representing 0.6% of its total 13F portfolio. In second place is Rubric Capital Management, led by David Rosen, which holds a position of $ 48.4 million; The fund has 2.8% of its 13F portfolio invested in the stock. Some other professional asset managers who are long positions include HG Vora Capital Management from Parag Vora, Jonathan Kolatchs Redwood Capital Management and Michael A. Price and Amos Merons Empyrean Capital Partners. In terms of the portfolio weights assigned to each position, Marlowe Partners assigned the largest weight to Playa Hotels & Resorts NV (NASDAQ: PLYA) at approximately 12.38% of its 13F portfolio. LDR Capital is also relatively bullish on the stock, referring to 6.57 percent of its 13F stock portfolio for PLYA.
As a result, some big names set out on their own. Dendur capital, led by Malcolm Levine, established the largest position in Playa Hotels & Resorts NV (NASDAQ: PLYA). Dendur Capital had invested $ 18.8 million in the company at the end of the quarter. Scott Rosss Hill Path capital also made a $ 15.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Lawrence Raiman’s LDR Capital, James Thomas Berylson’s Berylson Capital Partners, and George McCabe’s Portolan Capital Management.
Let’s run through hedge fund activity in other stocks – not necessarily in the same industry as Playa Hotels & Resorts NV (NYSE: PLA), but similarly valued. We will join the National HealthCare Corporation (NYSE:NHC), Ribbon Communications Inc. (NASDAQ:RBN), Oasis Petroleum Inc. (NASDAQ:OAS), Orion Engineered Carbons SA (NYSE:OEC), Fortuna Silver Mines Inc. (NYSE:FSM), Bolt Biotherapeutics, Inc. (NASDAQ:BOLT) and National Research Corporation (NASDAQ:NRC). The market valuations of this group of stocks are similar to the market valuation of PLYA.
[table] Ticker, number of HRs with positions, total value of HR positions (x1000), change in HR position NHC, 6.56897, -3 RBBN, 15.51556.5 OAS, 17.173658.3 OEC, 19.186263.0 FSM, 12.19878.1 BOLT, 23.423044.23 NRC, 9.31401, -3 average, 14.4.134671.3.7 [/table]
See table here when formatting problems occur.
As you can see, these stocks had an average of 14.4 hedge funds with bullish positions and the average amount invested in these stocks was $ 135 million. In the case of PLYA, that number was $ 348 million. Bolt Biotherapeutics, Inc. (NASDAQ:BOLT) is the most popular stock in this table. On the other side of the National HealthCare Corporation (NYSE:NHC) is the least popular with only 6 bullish hedge fund positions. Compared to these stocks, Playa Hotels & Resorts NV (NASDAQ: PLYA) is more popular with hedge funds. Our hedge fund sentiment score for PLYA is 88 overall. Stocks with a higher number of hedge fund positions compared to other stocks and relative to their historical range receive a higher sentiment score. Our calculations have shown that Top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, outperforming the S&P 500 ETF (SPY) by 40 percentage points. These stocks rose 24% through July 9 in 2021, still outperforming the market by 6.7 percentage points. Unfortunately, PLYA wasn’t nearly as popular as those 5 stocks and hedge funds that bet on PLYA were disappointed as the stock returned -1.5% since the end of the first quarter (through 9/7) and lagged the market. If you’re interested in investing in large-cap stocks with big upside potential, this is the place to go Top 5 most popular stocks among hedge funds, as most of these stocks have outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider monkey.
