At Insider Monkey, we pore over the filings of nearly 873 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of June 30th. In this article, we will use that wealth of knowledge to determine whether or not Dun & Bradstreet Corporation (NYSE:DNB) makes for a good investment right now.
Is Dun & Bradstreet Corporation (NYSE:DNB) a worthy investment today? The smart money was in an optimistic mood. The number of long hedge fund bets moved up by 16 lately. Dun & Bradstreet Corporation (NYSE:DNB) was in 45 hedge funds’ portfolios at the end of June. The all time high for this statistic is 34. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that DNB 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.
Ricky Sandler of Eminence Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, artificial intelligence is one of the fastest-growing industries right now, so we are checking out stock pitches like this emerging AI 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. Now we’re going to take a glance at the latest hedge fund action regarding Dun & Bradstreet Corporation (NYSE:DNB).
Do Hedge Funds Think DNB Is A Good Stock To Buy Now?
At the end of June, a total of 45 of the hedge funds tracked by Insider Monkey were long this stock, a change of 55% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards DNB over the last 24 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Ricky Sandler’s Eminence Capital has the number one position in Dun & Bradstreet Corporation (NYSE:DNB), worth close to $194.8 million, accounting for 2.4% of its total 13F portfolio. The second most bullish fund manager is Ken Griffin of Citadel Investment Group, with a $68 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors with similar optimism encompass Seth Rosen’s Nitorum Capital, Doug Silverman and Alexander Klabin’s Senator Investment Group and Will Cook’s Sunriver Management. In terms of the portfolio weights assigned to each position Sunriver Management allocated the biggest weight to Dun & Bradstreet Corporation (NYSE:DNB), around 8.66% of its 13F portfolio. Bluegrass Capital Partners is also relatively very bullish on the stock, setting aside 6.68 percent of its 13F equity portfolio to DNB.
As aggregate interest increased, key hedge funds were leading the bulls’ herd. Alua Capital Management, managed by Tom Purcell and Marco Tablada, assembled the biggest position in Dun & Bradstreet Corporation (NYSE:DNB). Alua Capital Management had $45.2 million invested in the company at the end of the quarter. Peter Seuss’s Prana Capital Management also made a $16.4 million investment in the stock during the quarter. The other funds with new positions in the stock are Brian Gootzeit and Andrew Frank’s StackLine Partners, Simon Sadler’s Segantii Capital, and Michael Gelband’s ExodusPoint Capital.
Let’s now review hedge fund activity in other stocks similar to Dun & Bradstreet Corporation (NYSE:DNB). These stocks are Syneos Health, Inc. (NASDAQ:SYNH), Manhattan Associates, Inc. (NASDAQ:MANH), Neurocrine Biosciences, Inc. (NASDAQ:NBIX), Arch Coal Inc (NYSE:ACI), Sensata Technologies Holding plc (NYSE:ST), Federal Realty Investment Trust (NYSE:FRT), and Algonquin Power & Utilities Corp. (NYSE:AQN). This group of stocks’ market values match DNB’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SYNH | 33 | 670476 | 5 |
| MANH | 28 | 408526 | 0 |
| NBIX | 32 | 900271 | 13 |
| ACI | 20 | 2910547 | 1 |
| ST | 32 | 1822315 | -4 |
| FRT | 16 | 86746 | 0 |
| AQN | 24 | 310750 | 14 |
| Average | 26.4 | 1015662 | 4.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $1016 million. That figure was $869 million in DNB’s case. Syneos Health, Inc. (NASDAQ:SYNH) is the most popular stock in this table. On the other hand Federal Realty Investment Trust (NYSE:FRT) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks Dun & Bradstreet Corporation (NYSE:DNB) is more popular among hedge funds. Our overall hedge fund sentiment score for DNB 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 gained 22.9% in 2021 through October 1st and still beat the market by 5.6 percentage points. Unfortunately DNB wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on DNB were disappointed as the stock returned -17.7% since the end of the second quarter (through 10/1) 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 since 2019.
Follow Dun & Bradstreet Corp (NYSE:DNB)
Follow Dun & Bradstreet Corp (NYSE:DNB)
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Disclosure: None. This article was originally published at Insider Monkey.
