A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30th, so let’s proceed with the discussion of the hedge fund sentiment on Hormel Foods Corporation (NYSE:HRL).
Hormel Foods Corporation (NYSE:HRL) was in 29 hedge funds’ portfolios at the end of September. The all time high for this statistic is 31. HRL investors should be aware of an increase in hedge fund sentiment lately. There were 24 hedge funds in our database with HRL holdings at the end of June. Our calculations also showed that HRL isn’t among the 30 most popular stocks among hedge funds (click for Q3 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. With all of this in mind let’s take a glance at the recent hedge fund action surrounding Hormel Foods Corporation (NYSE:HRL).
Cliff Asness of AQR Capital Management
Do Hedge Funds Think HRL Is A Good Stock To Buy Now?
At the end of September, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 21% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards HRL over the last 25 quarters. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
The largest stake in Hormel Foods Corporation (NYSE:HRL) was held by AQR Capital Management, which reported holding $120.3 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $90.8 million position. Other investors bullish on the company included Citadel Investment Group, Bridgewater Associates, and Millennium Management. In terms of the portfolio weights assigned to each position Kehrs Ridge Capital allocated the biggest weight to Hormel Foods Corporation (NYSE:HRL), around 1.65% of its 13F portfolio. Caxton Associates LP is also relatively very bullish on the stock, earmarking 0.35 percent of its 13F equity portfolio to HRL.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Balyasny Asset Management, managed by Dmitry Balyasny, initiated the largest position in Hormel Foods Corporation (NYSE:HRL). Balyasny Asset Management had $16.4 million invested in the company at the end of the quarter. Steve Cohen’s Point72 Asset Management also made a $10.6 million investment in the stock during the quarter. The other funds with brand new HRL positions are Paul Tudor Jones’s Tudor Investment Corp, Brian Scudieri’s Kehrs Ridge Capital, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Hormel Foods Corporation (NYSE:HRL) but similarly valued. These stocks are Imperial Oil Limited (NYSE:IMO), Bio-Rad Laboratories, Inc. (NYSE:BIO), Qualtrics International Inc. (NASDAQ:XM), Warner Music Group Corp. (NASDAQ:WMG), Waters Corporation (NYSE:WAT), PerkinElmer, Inc. (NYSE:PKI), and International Paper Company (NYSE:IP). This group of stocks’ market values are similar to HRL’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IMO | 10 | 99009 | -5 |
| BIO | 38 | 1442180 | -3 |
| XM | 26 | 1694438 | -11 |
| WMG | 28 | 972824 | -1 |
| WAT | 40 | 2673486 | 0 |
| PKI | 31 | 1920736 | -1 |
| IP | 30 | 263108 | -1 |
| Average | 29 | 1295112 | -3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29 hedge funds with bullish positions and the average amount invested in these stocks was $1295 million. That figure was $477 million in HRL’s case. Waters Corporation (NYSE:WAT) is the most popular stock in this table. On the other hand Imperial Oil Limited (NYSE:IMO) is the least popular one with only 10 bullish hedge fund positions. Hormel Foods Corporation (NYSE:HRL) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for HRL is 69.7. 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 28.6% in 2021 through November 30th and surpassed the market again by 5.6 percentage points. Unfortunately HRL wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); HRL investors were disappointed as the stock returned 1.6% since the end of September (through 11/30) 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 Hormel Foods Corp (NYSE:HRL)
Follow Hormel Foods Corp (NYSE:HRL)
Suggested Articles:
- 12 Best Infrastructure Stocks To Buy Now
- 15 Largest Fiber Optic Companies In The World
- 13 Most Influential Women To Watch in 2021
Disclosure: None. This article was originally published at Insider Monkey.
