In This Article:
How do we determine whether Snap Inc. (NYSE:SNAP) makes for a good investment at the moment? We analyze the sentiment of a select group of the very best investors in the world, who spend immense amounts of time and resources studying companies. They may not always be right (no one is), but data shows that their consensus long positions have historically outperformed the market when we adjust for known risk factors.
Is Snap Inc. (NYSE:SNAP) a healthy stock for your portfolio? Investors who are in the know are becoming more confident. The number of bullish hedge fund bets inched up by 2 recently. Our calculations also showed that snap isn't among the 30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We're going to take a gander at the latest hedge fund action regarding Snap Inc. (NYSE:SNAP).
What have hedge funds been doing with Snap Inc. (NYSE:SNAP)?
Heading into the fourth quarter of 2018, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 13% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards SNAP over the last 13 quarters. With hedge funds' sentiment swirling, there exists an "upper tier" of notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
The largest stake in Snap Inc. (NYSE:SNAP) was held by Tybourne Capital Management, which reported holding $265.3 million worth of stock at the end of September. It was followed by Hillhouse Capital Management with a $93.2 million position. Other investors bullish on the company included Citadel Investment Group, Slate Path Capital, and SRS Investment Management.