The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 873 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 June 30th. In this article we look at what those investors think of Emcor Group Inc (NYSE:EME).
Emcor Group Inc (NYSE:EME) shareholders have witnessed an increase in hedge fund interest recently. Emcor Group Inc (NYSE:EME) was in 21 hedge funds’ portfolios at the end of June. The all time high for this statistic is 29. Our calculations also showed that EME isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now let’s go over the recent hedge fund action surrounding Emcor Group Inc (NYSE:EME).
Do Hedge Funds Think EME Is A Good Stock To Buy Now?
At the end of June, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 5% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards EME over the last 24 quarters. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their holdings considerably (or already accumulated large positions).
The largest stake in Emcor Group Inc (NYSE:EME) was held by AQR Capital Management, which reported holding $39.2 million worth of stock at the end of June. It was followed by Value Holdings LP with a $22.1 million position. Other investors bullish on the company included Millennium Management, Stadium Capital Management, and Renaissance Technologies. In terms of the portfolio weights assigned to each position Stadium Capital Management allocated the biggest weight to Emcor Group Inc (NYSE:EME), around 7.94% of its 13F portfolio. Value Holdings LP is also relatively very bullish on the stock, earmarking 4.97 percent of its 13F equity portfolio to EME.
As aggregate interest increased, key hedge funds were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, established the most outsized position in Emcor Group Inc (NYSE:EME). Citadel Investment Group had $3.9 million invested in the company at the end of the quarter. Andrew Byington’s Appian Way Asset Management also made a $2.5 million investment in the stock during the quarter. The other funds with brand new EME positions are Lee Ainslie’s Maverick Capital, Donald Sussman’s Paloma Partners, and Qing Li’s Sciencast Management.
Let’s now take a look at hedge fund activity in other stocks similar to Emcor Group Inc (NYSE:EME). These stocks are Lemonade, Inc. (NYSE:LMND), Pinnacle Financial Partners (NASDAQ:PNFP), Healthequity Inc (NASDAQ:HQY), Texas Roadhouse Inc (NASDAQ:TXRH), AerCap Holdings N.V. (NYSE:AER), Janus Henderson Group plc (NYSE:JHG), and Acuity Brands, Inc. (NYSE:AYI). This group of stocks’ market caps are similar to EME’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LMND | 15 | 182362 | -1 |
| PNFP | 13 | 69655 | -1 |
| HQY | 20 | 286344 | 2 |
| TXRH | 37 | 806751 | 15 |
| AER | 45 | 1425101 | 2 |
| JHG | 22 | 1203630 | -6 |
| AYI | 33 | 794108 | 2 |
| Average | 26.4 | 681136 | 1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $681 million. That figure was $148 million in EME’s case. AerCap Holdings N.V. (NYSE:AER) is the most popular stock in this table. On the other hand Pinnacle Financial Partners (NASDAQ:PNFP) is the least popular one with only 13 bullish hedge fund positions. Emcor Group Inc (NYSE:EME) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for EME is 40.2. 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 24% in 2021 through October 22nd and surpassed the market again by 1.6 percentage points. Unfortunately EME wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); EME investors were disappointed as the stock returned -1.5% since the end of June (through 10/22) 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 Emcor Group Inc. (NYSE:EME)
Follow Emcor Group Inc. (NYSE:EME)
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Disclosure: None. This article was originally published at Insider Monkey.
