The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards TELUS International (Cda) Inc. (NYSE:TIXT).
TELUS International (Cda) Inc. (NYSE:TIXT) was in 21 hedge funds’ portfolios at the end of September. The all time high for this statistic was previously 10. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. TIXT has seen an increase in enthusiasm from smart money in recent months. There were 6 hedge funds in our database with TIXT positions at the end of the second quarter. Our calculations also showed that TIXT isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
Richard Driehaus of Driehaus Capital
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 look at the fresh hedge fund action regarding TELUS International (Cda) Inc. (NYSE:TIXT).
Do Hedge Funds Think TIXT Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 250% from one quarter earlier. By comparison, 0 hedge funds held shares or bullish call options in TIXT a year ago. With hedge funds’ sentiment swirling, there exists a few key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
The largest stake in TELUS International (Cda) Inc. (NYSE:TIXT) was held by Islet Management, which reported holding $22.7 million worth of stock at the end of September. It was followed by Millennium Management with a $10.1 million position. Other investors bullish on the company included Marshall Wace LLP, Driehaus Capital, and CaaS Capital. In terms of the portfolio weights assigned to each position Pinz Capital allocated the biggest weight to TELUS International (Cda) Inc. (NYSE:TIXT), around 1.62% of its 13F portfolio. Islet Management is also relatively very bullish on the stock, setting aside 0.49 percent of its 13F equity portfolio to TIXT.
As one would reasonably expect, some big names have been driving this bullishness. Islet Management, managed by Joseph Samuels, assembled the most outsized position in TELUS International (Cda) Inc. (NYSE:TIXT). Islet Management had $22.7 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also made a $9.7 million investment in the stock during the quarter. The other funds with new positions in the stock are Richard Driehaus’s Driehaus Capital, Frank Fu’s CaaS Capital, and Matthew L Pinz’s Pinz Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as TELUS International (Cda) Inc. (NYSE:TIXT) but similarly valued. These stocks are Assurant, Inc. (NYSE:AIZ), Churchill Downs Incorporated (NASDAQ:CHDN), AGCO Corporation (NYSE:AGCO), Federal Realty Investment Trust (NYSE:FRT), Credit Acceptance Corp. (NASDAQ:CACC), Jefferies Financial Group Inc. (NYSE:JEF), and Alcoa Corporation (NYSE:AA). This group of stocks’ market values resemble TIXT’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AIZ | 28 | 794083 | 2 |
| CHDN | 29 | 616749 | -6 |
| AGCO | 24 | 332496 | -14 |
| FRT | 21 | 165520 | 5 |
| CACC | 25 | 854969 | 5 |
| JEF | 37 | 684099 | 8 |
| AA | 44 | 1746130 | 0 |
| Average | 29.7 | 742007 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 29.7 hedge funds with bullish positions and the average amount invested in these stocks was $742 million. That figure was $71 million in TIXT’s case. Alcoa Corporation (NYSE:AA) 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 21 bullish hedge fund positions. Compared to these stocks TELUS International (Cda) Inc. (NYSE:TIXT) is even less popular than FRT. Our overall hedge fund sentiment score for TIXT is 40. 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. Hedge funds dodged a bullet by taking a bearish stance towards TIXT. Our calculations showed that the top 5 most popular hedge fund stocks returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 but managed to beat the market again by 3.6 percentage points. Unfortunately TIXT wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was very bearish); TIXT investors were disappointed as the stock returned -5.6% since the end of the third quarter (through 12/31) 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 Telus International (Cda) Inc.
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Disclosure: None. This article was originally published at Insider Monkey.
