Hedge Funds Are Crazy About Hub Group Inc (HUBG)

After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of June 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Hub Group Inc (NASDAQ:HUBG).

Hub Group Inc (NASDAQ:HUBG) was in 24 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic was previously 23. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. HUBG has seen an increase in support from the world’s most elite money managers of late. There were 19 hedge funds in our database with HUBG positions at the end of the first quarter. Our calculations also showed that HUBG 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.

Ken Fisher of Fisher Asset Management

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 we’re going to take a look at the recent hedge fund action regarding Hub Group Inc (NASDAQ:HUBG).

Do Hedge Funds Think HUBG Is A Good Stock To Buy Now?

At the end of the second quarter, a total of 24 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 26% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards HUBG over the last 24 quarters. With hedgies’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).

Among these funds, Fisher Asset Management held the most valuable stake in Hub Group Inc (NASDAQ:HUBG), which was worth $62.2 million at the end of the second quarter. On the second spot was Scopus Asset Management which amassed $45.9 million worth of shares. Royce & Associates, Scopus Asset Management, and Arrowstreet Capital 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 Southport Management allocated the biggest weight to Hub Group Inc (NASDAQ:HUBG), around 2.46% of its 13F portfolio. 12th Street Asset Management is also relatively very bullish on the stock, dishing out 1.35 percent of its 13F equity portfolio to HUBG.

Now, key money managers have jumped into Hub Group Inc (NASDAQ:HUBG) headfirst. Scopus Asset Management, managed by Alexander Mitchell, initiated the largest call position in Hub Group Inc (NASDAQ:HUBG). Scopus Asset Management had $26.4 million invested in the company at the end of the quarter. Michael O’Keefe’s 12th Street Asset Management also initiated a $6.5 million position during the quarter. The following funds were also among the new HUBG investors: Louis Bacon’s Moore Global Investments, Richard SchimeláandáLawrence Sapanski’s Cinctive Capital Management, and Paul Marshall and Ian Wace’s Marshall Wace LLP.

Let’s now take a look at hedge fund activity in other stocks similar to Hub Group Inc (NASDAQ:HUBG). We will take a look at Prothena Corporation plc (NASDAQ:PRTA), Telos Corporation (NASDAQ:TLS), First Midwest Bancorp Inc (NASDAQ:FMBI), First Merchants Corporation (NASDAQ:FRME), Belden Inc. (NYSE:BDC), Dream Finders Homes, Inc. (NASDAQ:DFH), and American Assets Trust, Inc (NYSE:AAT). This group of stocks’ market valuations match HUBG’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 14.3 hedge funds with bullish positions and the average amount invested in these stocks was $227 million. That figure was $206 million in HUBG’s case. Prothena Corporation plc (NASDAQ:PRTA) is the most popular stock in this table. On the other hand Dream Finders Homes, Inc. (NASDAQ:DFH) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Hub Group Inc (NASDAQ:HUBG) is more popular among hedge funds. Our overall hedge fund sentiment score for HUBG is 90. 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 24% in 2021 through October 22nd but still managed to beat the market by 1.6 percentage points. Hedge funds were also right about betting on HUBG as the stock returned 17.9% since the end of June (through 10/22) 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.