In this article we will take a look at whether hedge funds consider Workday Inc (NYSE: WDAY) a good investment right now. We examine the feelings of a hedge fund and billions investor before heading into research hours. Hedge funds cost Ivy League graduates millions of dollars, non-traditional data stores, expert networks, and receive recommendations from investment bankers and business owners. Sure they fail miserably, but historically their consensus stocks outperformed the market after adjusting for known risk factors.
Is WDAY stock buying or selling? Well-known investors took an optimistic view. The number of hedge fund positions has gone a long way by 6 in the last few months. Workday Inc (NYSE: WDAY) was in the folds of 80 hedge funds at the end of December. The maximum for this statistic is 74.. This means that the bullish number of hedge fund positions in this stock is currently at all high levels. Our calculations also showed that WDAY is not among the 30 most popular stocks among hedge funds (click for Q4 rating). There were 74 hedge funds in our database with WDAY positions at the end of the third quarter.
In the world of finance there are a large number of tools that investors have to rank stocks. A pair of the most sub-radar devices are hedge fund signals and insider trading. We have shown, historically, that those who follow a high selection of the best asset managers can outperform broader indices. Insider Monkey’s monthly stocks returned 197% from March 2017 and outperformed the S&P 500 ETF by more than 124 percentage points. Our short strategy outperformed the short S&P 500 ETF by 20 percentage points per year (see details here). That is why we believe that hedge fund sentiment is a useful indicator that investors should pay attention to.
Daniel Och, Founder of OZ Governance
At Monkey Insider we leave no stone unturned as we look for the next big investment idea. Oregon was recently the first state to legalize psychedelic mushrooms that have been shown to have promising results in treating depression, addiction, and PTSD in early-stage academic studies. So, we study this opinion on psychedelic drug stock right now. We go through lists like the top 10 hydrogen fuel cell stocks to choose the next Tesla that will deliver 10x output. Even though we recommend positions in only a handful of the companies we analyze, we examine as much stock as possible. We read the letters of hedge fund investors and listen to stock areas at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage (or at the end of this article). Now let’s take a look at recent hedge fund activity around Workday Inc (NYSE: WDAY).
Do hedge funds think WDAY Is stock good to buy now?
At the end of the fourth quarter, 80 of the hedge fund on which Insider Monkey was monitoring this stock, an 8% change from the third quarter of 2020. Below, you can check out the change in the hedge fund sentiment towards WDAY over the last 22 quarters. With the capital of the smart money changing hands, there is a “top tier” of well-known hedge fund managers who were making significant contributions to their holdings (or who had already amassed large positions).
Among these funds, Tiger Global Management LLC held the most valuable stake in Workday Inc (NYSE: WDAY), valued at $ 989 million at the end of the fourth quarter. In second place was Bares Capital Management which was accumulating $ 655.9 million worth of shares. Skye Global Management, Matrix Capital Management, and OZ Management were also very fond of the stock, growing into one of the largest hedge fund owners in the company. In terms of portfolio weights assigned to each position, North Peak Capital gave Workday Inc (NYSE: WDAY) the largest weighting, approximately 13.1% of its 13F portfolio. Bares Capital Management is also relatively bullish on the stock, fishing out 12.13 percent of their 13F equity portfolio to WDAY.
No hedge funds were starting new positions in the stock in the fourth quarter.
We now look at hedge fund activity in other stocks – perhaps not in the same business as Workday Inc (NYSE: WDAY) but also valued. These stocks are Takeda Pharmaceutical Company Limited (NYSE: TAK), Edwards Lifesciences Corporation (NYSE: EW), PetroChina Company Limited (NYSE: PTR), Itau Unibanco Holding SA (NYSE: ITUB), HCA Healthcare Inc (NYSE: HCA ), Dell Technologies Inc. (NYSE: DELL), and Analog Devices, Inc. (NASDAQ: ADI). This group of market valuations is similar to WDAY market valuations.
[table] Ticker, Number of HFs with positions, Total Value of HF Positions (x1000), Change in HF TAK position, 18,835529, -1 EW, 38,1243466, -8 PTR, 5,61529, -1 ITUB, 19,451744 , 3 HCA, 73,3564991,2 DELL, 50,3909030,7 ADI, 58,5319785,6 Average, 37.3,2198011,1.1 [/table]
See the chart here if you know of shape issues.
As you can see these stocks had an average of 37.3 hedge funds with bullish positions and the average amount invested in these stocks was $ 2198 million. That figure was $ 4443 million in the WDAY case. The most popular stock in this list is HCA Healthcare Inc (NYSE: HCA). PetroChina Company Limited (NYSE: PTR), on the other hand, is the most popular with only 5 bullish hedge fund positions. Compared to these stocks Workday Inc (NYSE: WDAY) is more popular among hedge funds. Our total hedge fund score for WDAY is 90. Stocks with a higher number of hedge fund position compared to other stocks in addition to their historical range get a higher sentiment score. Our calculations showed that the 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, outperforming the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 7% in 2021 through March 12th and still outperformed the market by 1.6 percentage points. Hedge funds were also right about betting on WDAY, although not to the same extent, as the stock returned 5.5% from the end of December (through March 12) and outperformed market as well.
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Disclosure: None. This article was first published by Insider Monkey.