Do Hedge Funds Love Casey’s General Stores, Inc. (CASY)?

In this article we are going to use hedge fund sentiment as a tool and determine whether Casey’s General Stores, Inc. (NASDAQ:CASY) is a good investment right now. We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.

Is Casey’s General Stores, Inc. (NASDAQ:CASY) a marvelous investment today? The best stock pickers were cutting their exposure. The number of bullish hedge fund bets were trimmed by 2 lately. Casey’s General Stores, Inc. (NASDAQ:CASY) was in 22 hedge funds’ portfolios at the end of September. The all time high for this statistic is 28. Our calculations also showed that CASY isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

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. Keeping this in mind we’re going to take a look at the fresh hedge fund action surrounding Casey’s General Stores, Inc. (NASDAQ:CASY).

Fred DiSanto of Ancora Advisors

Do Hedge Funds Think CASY Is A Good Stock To Buy Now?

At the end of the third quarter, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of -8% from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards CASY over the last 25 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Citadel Investment Group was the largest shareholder of Casey’s General Stores, Inc. (NASDAQ:CASY), with a stake worth $44.1 million reported as of the end of September. Trailing Citadel Investment Group was AQR Capital Management, which amassed a stake valued at $41.5 million. Millennium Management, Point72 Asset Management, and Rip Road 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 Rip Road Capital allocated the biggest weight to Casey’s General Stores, Inc. (NASDAQ:CASY), around 4.43% of its 13F portfolio. McKinley Capital Management is also relatively very bullish on the stock, dishing out 0.57 percent of its 13F equity portfolio to CASY.

Due to the fact that Casey’s General Stores, Inc. (NASDAQ:CASY) has faced declining sentiment from the aggregate hedge fund industry, it’s easy to see that there is a sect of funds who were dropping their entire stakes last quarter. At the top of the heap, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital cut the biggest stake of the 750 funds tracked by Insider Monkey, valued at an estimated $11.5 million in stock. Paul Tudor Jones’s fund, Tudor Investment Corp, also dumped its stock, about $3.2 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds last quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Casey’s General Stores, Inc. (NASDAQ:CASY) but similarly valued. We will take a look at Voya Financial Inc (NYSE:VOYA), Woori Financial Group Inc. (NYSE:WF), Chart Industries, Inc. (NYSE:GTLS), BlackLine, Inc. (NASDAQ:BL), Nielsen Holdings plc (NYSE:NLSN), The Descartes Systems Group Inc (NASDAQ:DSGX), and Littelfuse, Inc. (NASDAQ:LFUS). This group of stocks’ market values match CASY’s market value.

View table here if you experience formatting issues.

As you can see these stocks had an average of 19.9 hedge funds with bullish positions and the average amount invested in these stocks was $576 million. That figure was $211 million in CASY’s case. Voya Financial Inc (NYSE:VOYA) is the most popular stock in this table. On the other hand Woori Financial Group Inc. (NYSE:WF) is the least popular one with only 2 bullish hedge fund positions. Casey’s General Stores, Inc. (NASDAQ:CASY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CASY is 56.9. 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 positive signal but 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 beat the market again by 3.6 percentage points. Unfortunately CASY wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on CASY were disappointed as the stock returned 4.9% 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 many of these stocks already outperformed the market since 2019.

Suggested Articles:

• 15 Biggest Paper Companies In The World
• 15 Largest FMCG Companies in the World
• Top 10 ESG Stocks To Buy

Disclosure: None. This article was originally published at Insider Monkey.