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16 Stocks Top Hedge Funds Snapped Up Last Quarter

16 Stocks Top Hedge Funds Snapped Up Last Quarter

The “smart money” have been buying up shares in these 16 companies, and analysts say 2 of them could see MASSIVE upside ahead.

If you want to know what the smart money are buying, then looking at Hedge Funds’ quarterly 13-F filings—where firms disclose what stocks they’ve bought and sold—is a good place to start.

Goldman Sachs (NYSE: GS) combed through the third-quarter 13-F filings of 833 hedge funds with $2.1 trillion in gross equity positions for its Hedge Fund Trend Monitor report that it released early this week. 

In looking at the filings, the firm came up with a list of the top 10 holdings of hedge funds for its “Hedge Fund VIP” list. 

According to the report, this list of 10 stocks is a tool for investors who want to “follow the smart money,” and historically, this “Hedge Fund VIP” basket has been a strong performer, though it has lagged the S&P 500 this year by about 4 percentage points. Still, in the last couple of weeks, the VIP list has been outperforming the S&P 500 index by 2 percentage points. 

Goldman’s “Hedge Fund VIP” basket includes Salesforce (NYSE: CRM), Mastercard (NYSE: MA), Fidelity National Information Services (NYSE: FIS), Visa (NYSE: V), Allergan (NYSE: AGN), Google-parent Alphabet (NASDAQ: GOOGL, GOOG), Alibaba (NYSE: BABA), Facebook (NASDAQ: FB), Amazon (NASDAQ: AMZN), and Microsoft (NASDAQ: MSFT). So far this year, these stocks are up 18.92%, 50.78%, 33.08%, 36.34%, 38.07%, 24.42%, 34.87%, 50.99%, 15.5%, and 47.17%, respectively. 

But beyond these top 10 stocks owned by hedge funds, the third-quarter 13-F filings revealed that some of the best under-the-radar fund managers are doubling down on bank stocks, including Morgan Stanley (NYSE: MS), Bank of New York Mellon (NYSE: BK), Zions Bancorp (NASDAQ: ZION), Noah Holdings (NYSE: NOAH), StoneCo (NASDAQ: STNE), and HarborOne Bancorp (NASDAQ: HONE). 

It’s not a surprise that hedge funds are betting big on financials considering the sector has been the biggest winner among the 11 S&P 500 sectors over the past three months, rising more than 11% during the quarter.

Of these financials Morgan Stanley, Zions Bancorp, StoneCo, and HarborOne have seen the biggest returns, gaining 23.18%, 20.62%, 86.28%, and 19.85%, respectively.

But of all the 16 stocks, analysts are most bullish on two stocks in particular: Noah Holdings, and HarborOne Bancorp. 

Analysts’ average 12-month price target for Noah Holdings indicates 86.20% upside potential, while their average targets for HarborOne indicates 93.21% upside over the next year.

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