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 second 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 Kirby Corporation (NYSE:KEX) based on that data.
Is Kirby Corporation (NYSE:KEX) going to take off soon? Prominent investors were taking a bearish view. The number of long hedge fund bets were cut by 2 lately. Kirby Corporation (NYSE:KEX) was in 21 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 34. Our calculations also showed that KEX isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 23 hedge funds in our database with KEX positions at the end of the first quarter.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still 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). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
Ken Griffin of Citadel Investment Group
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. With all of this in mind let’s check out the latest hedge fund action encompassing Kirby Corporation (NYSE:KEX).
Do Hedge Funds Think KEX Is A Good Stock To Buy Now?
Heading into the third quarter of 2021, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -9% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards KEX over the last 24 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Kirby Corporation (NYSE:KEX) was held by Diamond Hill Capital, which reported holding $162.5 million worth of stock at the end of June. It was followed by Thunderbird Partners with a $120.2 million position. Other investors bullish on the company included Hound Partners, D E Shaw, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Thunderbird Partners allocated the biggest weight to Kirby Corporation (NYSE:KEX), around 10.79% of its 13F portfolio. Hound Partners is also relatively very bullish on the stock, earmarking 5.73 percent of its 13F equity portfolio to KEX.
Due to the fact that Kirby Corporation (NYSE:KEX) has experienced a decline in interest from the smart money, it’s easy to see that there were a few money managers that slashed their positions entirely by the end of the second quarter. Interestingly, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital cut the biggest investment of the 750 funds followed by Insider Monkey, valued at close to $22.3 million in stock, and Mark Coe’s Intrinsic Edge Capital was right behind this move, as the fund dropped about $3.8 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 2 funds by the end of the second quarter.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Kirby Corporation (NYSE:KEX) but similarly valued. We will take a look at Brookfield Business Partners L.P. (NYSE:BBU), Installed Building Products Inc (NYSE:IBP), Camping World Holdings, Inc. (NYSE:CWH), Spectrum Brands Holdings, Inc. (NYSE:SPB), Shutterstock Inc (NYSE:SSTK), Vonage Holdings Corp. (NYSE:VG), and Steven Madden, Ltd. (NASDAQ:SHOO). This group of stocks’ market values match KEX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BBU | 4 | 24531 | 1 |
| IBP | 12 | 55396 | -9 |
| CWH | 20 | 292507 | -4 |
| SPB | 35 | 578244 | -2 |
| SSTK | 18 | 214408 | 0 |
| VG | 29 | 708094 | -7 |
| SHOO | 18 | 157045 | -1 |
| Average | 19.4 | 290032 | -3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.4 hedge funds with bullish positions and the average amount invested in these stocks was $290 million. That figure was $584 million in KEX’s case. Spectrum Brands Holdings, Inc. (NYSE:SPB) is the most popular stock in this table. On the other hand Brookfield Business Partners L.P. (NYSE:BBU) is the least popular one with only 4 bullish hedge fund positions. Kirby Corporation (NYSE:KEX) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for KEX is 48.9. 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 24% in 2021 through October 22nd and beat the market again by 1.6 percentage points. Unfortunately KEX wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on KEX were disappointed as the stock returned -6.3% 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 many of these stocks already outperformed the market since 2019.
Follow Kirby Corp (NYSE:KEX)
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Disclosure: None. This article was originally published at Insider Monkey.
