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 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. In this article we look at what those investors think of McCormick & Company, Incorporated (NYSE:MKC).
Is McCormick & Company, Incorporated (NYSE:MKC) a cheap stock to buy now? The best stock pickers were in a bullish mood. The number of long hedge fund bets moved up by 1 in recent months. McCormick & Company, Incorporated (NYSE:MKC) was in 35 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 37. Our calculations also showed that MKC isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Cliff Asness of AQR Capital Management
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 let’s take a peek at the fresh hedge fund action regarding McCormick & Company, Incorporated (NYSE:MKC).
Do Hedge Funds Think MKC Is A Good Stock To Buy Now?
At the end of September, a total of 35 of the hedge funds tracked by Insider Monkey were long this stock, a change of 3% from the previous quarter. On the other hand, there were a total of 37 hedge funds with a bullish position in MKC a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).
Among these funds, Fundsmith LLP held the most valuable stake in McCormick & Company, Incorporated (NYSE:MKC), which was worth $1516.4 million at the end of the third quarter. On the second spot was Impax Asset Management which amassed $53.1 million worth of shares. Millennium Management, AQR Capital Management, and Renaissance Technologies 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 Fundsmith LLP allocated the biggest weight to McCormick & Company, Incorporated (NYSE:MKC), around 4.19% of its 13F portfolio. Sciencast Management is also relatively very bullish on the stock, earmarking 0.63 percent of its 13F equity portfolio to MKC.
With a general bullishness amongst the heavyweights, key money managers have been driving this bullishness. Select Equity Group, managed by Robert Joseph Caruso, assembled the most valuable position in McCormick & Company, Incorporated (NYSE:MKC). Select Equity Group had $8.9 million invested in the company at the end of the quarter. Qing Li’s Sciencast Management also made a $2.2 million investment in the stock during the quarter. The other funds with new positions in the stock are Paul Tudor Jones’s Tudor Investment Corp, Ran Pang’s Quantamental Technologies, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s go over hedge fund activity in other stocks similar to McCormick & Company, Incorporated (NYSE:MKC). We will take a look at DTE Energy Company (NYSE:DTE), FleetCor Technologies, Inc. (NYSE:FLT), Dollar Tree, Inc. (NASDAQ:DLTR), TransUnion (NYSE:TRU), Mid America Apartment Communities Inc (NYSE:MAA), PPL Corporation (NYSE:PPL), and Sun Communities Inc (NYSE:SUI). This group of stocks’ market values are similar to MKC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DTE | 22 | 426119 | -10 |
| FLT | 31 | 2095712 | -9 |
| DLTR | 38 | 1215394 | -4 |
| TRU | 38 | 2180644 | 3 |
| MAA | 22 | 254912 | 8 |
| PPL | 20 | 140767 | -3 |
| SUI | 33 | 794559 | 3 |
| Average | 29.1 | 1015444 | -1.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.1 hedge funds with bullish positions and the average amount invested in these stocks was $1015 million. That figure was $1782 million in MKC’s case. Dollar Tree, Inc. (NASDAQ:DLTR) is the most popular stock in this table. On the other hand PPL Corporation (NYSE:PPL) is the least popular one with only 20 bullish hedge fund positions. McCormick & Company, Incorporated (NYSE:MKC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MKC is 76. 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on MKC, though not to the same extent, as the stock returned 6.4% since Q3 (through November 30th) and outperformed the market as well.
Follow Mccormick & Co Inc (NYSE:MKC)
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Disclosure: None. This article was originally published at Insider Monkey.
