Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Concentrix Corporation (NASDAQ:CNXC).
Concentrix Corporation (NASDAQ:CNXC) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 21 hedge funds’ portfolios at the end of September. Our calculations also showed that CNXC isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as AECOM (NYSE:ACM), Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN), and Algonquin Power & Utilities Corp. (NYSE:AQN) to gather more data points.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind let’s check out the new hedge fund action encompassing Concentrix Corporation (NASDAQ:CNXC).
David Einhorn of Greenlight Capital
Do Hedge Funds Think CNXC Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the second quarter of 2021. By comparison, 0 hedge funds held shares or bullish call options in CNXC a year ago. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
More specifically, Lyrical Asset Management was the largest shareholder of Concentrix Corporation (NASDAQ:CNXC), with a stake worth $174.1 million reported as of the end of September. Trailing Lyrical Asset Management was Abrams Bison Investments, which amassed a stake valued at $165.8 million. Alyeska Investment Group, Greenlight Capital, and Arrowstreet Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Abrams Bison Investments allocated the biggest weight to Concentrix Corporation (NASDAQ:CNXC), around 12.35% of its 13F portfolio. Greenlight Capital is also relatively very bullish on the stock, earmarking 3.16 percent of its 13F equity portfolio to CNXC.
Judging by the fact that Concentrix Corporation (NASDAQ:CNXC) has faced falling interest from the aggregate hedge fund industry, it’s safe to say that there is a sect of funds that decided to sell off their full holdings by the end of the third quarter. It’s worth mentioning that Robert Joseph Caruso’s Select Equity Group sold off the largest investment of the “upper crust” of funds monitored by Insider Monkey, comprising about $16.6 million in stock. Dmitry Balyasny’s fund, Balyasny Asset Management, also said goodbye to its stock, about $3.2 million worth. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Concentrix Corporation (NASDAQ:CNXC) but similarly valued. We will take a look at AECOM (NYSE:ACM), Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN), Algonquin Power & Utilities Corp. (NYSE:AQN), Neurocrine Biosciences, Inc. (NASDAQ:NBIX), Sunrun Inc (NASDAQ:RUN), Ascendis Pharma A/S (NASDAQ:ASND), and Globe Life Inc. (NYSE:GL). This group of stocks’ market values are similar to CNXC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ACM | 39 | 783809 | 7 |
| BHVN | 33 | 1063983 | 6 |
| AQN | 15 | 152646 | -9 |
| NBIX | 31 | 980578 | -1 |
| RUN | 37 | 1677910 | -8 |
| ASND | 23 | 2827508 | -6 |
| GL | 27 | 775771 | -1 |
| Average | 29.3 | 1180315 | -1.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.3 hedge funds with bullish positions and the average amount invested in these stocks was $1180 million. That figure was $587 million in CNXC’s case. AECOM (NYSE:ACM) is the most popular stock in this table. On the other hand Algonquin Power & Utilities Corp. (NYSE:AQN) is the least popular one with only 15 bullish hedge fund positions. Concentrix Corporation (NASDAQ:CNXC) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CNXC is 44.9. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and surpassed the market again by 3.6 percentage points. Unfortunately CNXC wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); CNXC investors were disappointed as the stock returned 1.1% since the end of September (through 12/31) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.
Follow Concentrix Corp (NASDAQ:CNXC)
Follow Concentrix Corp (NASDAQ:CNXC)
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Disclosure: None. This article was originally published at Insider Monkey.
