Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the fourth quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of W.R. Grace & Co. (NYSE:GRA) based on that data.
W.R. Grace & Co. (NYSE:GRA) has seen an increase in activity from the world’s largest hedge funds lately. W.R. Grace & Co. (NYSE:GRA) was in 43 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 47. There were 40 hedge funds in our database with GRA holdings at the end of December. Our calculations also showed that GRA isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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William Von Mueffling of Cantillon Capital Management
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Do Hedge Funds Think GRA Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 43 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 8% from the previous quarter. The graph below displays the number of hedge funds with bullish position in GRA over the last 23 quarters. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Among these funds, 40 North Management held the most valuable stake in W.R. Grace & Co. (NYSE:GRA), which was worth $590.5 million at the end of the fourth quarter. On the second spot was Soroban Capital Partners which amassed $163.5 million worth of shares. Lyrical Asset Management, Diamond Hill Capital, and Cantillon Capital Management 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 40 North Management allocated the biggest weight to W.R. Grace & Co. (NYSE:GRA), around 16.32% of its 13F portfolio. Atlantic Investment Management is also relatively very bullish on the stock, setting aside 15.95 percent of its 13F equity portfolio to GRA.
Now, some big names have jumped into W.R. Grace & Co. (NYSE:GRA) headfirst. Segantii Capital, managed by Simon Sadler, assembled the most outsized position in W.R. Grace & Co. (NYSE:GRA). Segantii Capital had $30.5 million invested in the company at the end of the quarter. Noam Gottesman’s GLG Partners also made a $8.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Carl Tiedemann and Michael Tiedemann’s TIG Advisors, Gary Claar’s Claar Advisors, and Orkun Kilic’s Berry Street Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as W.R. Grace & Co. (NYSE:GRA) but similarly valued. These stocks are BigCommerce Holdings, Inc. (NASDAQ:BIGC), H&R Block, Inc. (NYSE:HRB), Atotech Limited (NYSE:ATC), Goosehead Insurance, Inc. (NASDAQ:GSHD), The Brink’s Company (NYSE:BCO), Southwest Gas Holdings, Inc. (NYSE:SWX), and Colliers International Group Inc (NASDAQ:CIGI). This group of stocks’ market values resemble GRA’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BIGC | 26 | 505108 | 0 |
| HRB | 27 | 228558 | 4 |
| ATC | 17 | 69894 | 17 |
| GSHD | 24 | 162339 | 3 |
| BCO | 24 | 406832 | -2 |
| SWX | 23 | 159735 | 6 |
| CIGI | 14 | 866464 | 3 |
| Average | 22.1 | 342704 | 4.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 22.1 hedge funds with bullish positions and the average amount invested in these stocks was $343 million. That figure was $1434 million in GRA’s case. H&R Block, Inc. (NYSE:HRB) is the most popular stock in this table. On the other hand Colliers International Group Inc (NASDAQ:CIGI) is the least popular one with only 14 bullish hedge fund positions. Compared to these stocks W.R. Grace & Co. (NYSE:GRA) is more popular among hedge funds. Our overall hedge fund sentiment score for GRA is 85.4. 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 returned 17.4% in 2021 through June 18th but still managed to beat the market by 6.1 percentage points. Hedge funds were also right about betting on GRA as the stock returned 14.6% since the end of March (through 6/18) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
