Published on 12 Oct 2021 on Insider Monkey via Yahoo Finance

Hedge Funds Are Done Selling Godaddy Inc (GDDY)

We at Insider Monkey have gone over 873 13F filings that hedge funds and prominent investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of June 30th. In this article, we look at what those funds think of Godaddy Inc (NYSE:GDDY) based on that data.

Godaddy Inc (NYSE:GDDY) shares haven't seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 39 hedge funds' portfolios at the end of June. Our calculations also showed that GDDY isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings). At the end of this article we will also compare GDDY to other stocks including Citrix Systems, Inc. (NASDAQ:CTXS), UDR, Inc. (NYSE:UDR), and Fair Isaac Corporation (NYSE:FICO) to get a better sense of its popularity.

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 S&P 500 ETFs by 79 percentage points since March 2017 (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.