The latest 13F reporting period has come and gone, and Insider Monkey have plowed through 867 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th, when the S&P 500 Index was trading around the 4300 level. Since then investors decided to bet on the economic recovery and a stock market rebound even though we experienced a temporary correction in January. In this article you are going to find out whether hedge funds thought The Clorox Company (NYSE:CLX) was a good investment heading into the fourth quarter and how the stock traded in comparison to the top hedge fund picks.
The Clorox Company (NYSE:CLX) was in 34 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 41. CLX investors should be aware of a decrease in hedge fund interest recently. There were 37 hedge funds in our database with CLX holdings at the end of June. Our calculations also showed that CLX isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Mario Gabelli of GAMCO Investors
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 we’re going to check out the key hedge fund action regarding The Clorox Company (NYSE:CLX).
Do Hedge Funds Think CLX Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -8% from the second quarter of 2021. On the other hand, there were a total of 39 hedge funds with a bullish position in CLX a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Cedar Rock Capital held the most valuable stake in The Clorox Company (NYSE:CLX), which was worth $268.9 million at the end of the third quarter. On the second spot was Renaissance Technologies which amassed $214.2 million worth of shares. Citadel Investment Group, AQR Capital Management, and Two Sigma Advisors 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 Cedar Rock Capital allocated the biggest weight to The Clorox Company (NYSE:CLX), around 6.45% of its 13F portfolio. L2 Asset Management is also relatively very bullish on the stock, designating 0.93 percent of its 13F equity portfolio to CLX.
Seeing as The Clorox Company (NYSE:CLX) has witnessed a decline in interest from the entirety of the hedge funds we track, it’s easy to see that there exists a select few fund managers who were dropping their full holdings heading into Q4. It’s worth mentioning that Jack Woodruff’s Candlestick Capital Management cut the largest stake of the 750 funds followed by Insider Monkey, totaling an estimated $65.7 million in call options, and Donald Sussman’s Paloma Partners was right behind this move, as the fund said goodbye to about $4.5 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 3 funds heading into Q4.
Let’s now take a look at hedge fund activity in other stocks similar to The Clorox Company (NYSE:CLX). We will take a look at Cenovus Energy Inc (NYSE:CVE), Church & Dwight Co., Inc. (NYSE:CHD), Expeditors International of Washington (NASDAQ:EXPD), Teladoc Health, Inc (NYSE:TDOC), Enphase Energy Inc (NASDAQ:ENPH), Dynatrace, Inc. (NYSE:DT), and NetApp Inc. (NASDAQ:NTAP). This group of stocks’ market values are similar to CLX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CVE | 30 | 717847 | -2 |
| CHD | 20 | 1362889 | -15 |
| EXPD | 26 | 452843 | -3 |
| TDOC | 40 | 2836350 | -3 |
| ENPH | 52 | 637786 | 8 |
| DT | 41 | 2389054 | -9 |
| NTAP | 29 | 671456 | -2 |
| Average | 34 | 1295461 | -3.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 34 hedge funds with bullish positions and the average amount invested in these stocks was $1295 million. That figure was $972 million in CLX’s case. Enphase Energy Inc (NASDAQ:ENPH) is the most popular stock in this table. On the other hand Church & Dwight Co., Inc. (NYSE:CHD) is the least popular one with only 20 bullish hedge fund positions. The Clorox Company (NYSE:CLX) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CLX is 48.8. 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. 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 still managed to beat the market by another 3.6 percentage points. Hedge funds were somewhat right about betting on CLX as the stock returned 2.8% since the end of September (through January 31st) and outperformed the top 5 hedge fund stocks but not the market. This is a rare phenomenon as top hedge fund stocks usually beat the market over the long-term.
Follow Clorox Co (NYSE:CLX)
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Disclosure: None. This article was originally published at Insider Monkey.
