In this article we will check out the progression of hedge fund sentiment towards Performance Food Group Company (NYSE:PFGC) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
Performance Food Group Company (NYSE:PFGC) has seen a decrease in activity from the world’s largest hedge funds lately. Performance Food Group Company (NYSE:PFGC) was in 36 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 41. Our calculations also showed that PFGC 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. Now we’re going to check out the fresh hedge fund action surrounding Performance Food Group Company (NYSE:PFGC).
Dmitry Balyasny of Balyasny Asset Management
Do Hedge Funds Think PFGC Is A Good Stock To Buy Now?
At third quarter’s end, a total of 36 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -12% from the second quarter of 2021. By comparison, 29 hedge funds held shares or bullish call options in PFGC a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
The largest stake in Performance Food Group Company (NYSE:PFGC) was held by Citadel Investment Group, which reported holding $139.4 million worth of stock at the end of September. It was followed by Eminence Capital with a $117.9 million position. Other investors bullish on the company included Balyasny Asset Management, Point72 Asset Management, and Candlestick Capital Management. In terms of the portfolio weights assigned to each position Kehrs Ridge Capital allocated the biggest weight to Performance Food Group Company (NYSE:PFGC), around 7.13% of its 13F portfolio. MIK Capital is also relatively very bullish on the stock, earmarking 5.24 percent of its 13F equity portfolio to PFGC.
Due to the fact that Performance Food Group Company (NYSE:PFGC) has witnessed bearish sentiment from the entirety of the hedge funds we track, logic holds that there were a few hedge funds that elected to cut their positions entirely in the third quarter. It’s worth mentioning that D. E. Shaw’s D E Shaw dumped the largest stake of the 750 funds watched by Insider Monkey, valued at an estimated $26.4 million in stock. Renaissance Technologies, also cut its stock, about $20.8 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 5 funds in the third quarter.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Performance Food Group Company (NYSE:PFGC) but similarly valued. We will take a look at Affiliated Managers Group, Inc. (NYSE:AMG), Duolingo Inc. (NASDAQ:DUOL), ANGI Inc (NASDAQ:ANGI), Emcor Group Inc (NYSE:EME), Acuity Brands, Inc. (NYSE:AYI), Freshpet Inc (NASDAQ:FRPT), and BOK Financial Corporation (NASDAQ:BOKF). All of these stocks’ market caps resemble PFGC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AMG | 30 | 753848 | 0 |
| DUOL | 12 | 183935 | 12 |
| ANGI | 26 | 256863 | 0 |
| EME | 19 | 136492 | -2 |
| AYI | 26 | 476748 | -7 |
| FRPT | 24 | 348415 | -4 |
| BOKF | 15 | 376008 | 2 |
| Average | 21.7 | 361758 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.7 hedge funds with bullish positions and the average amount invested in these stocks was $362 million. That figure was $747 million in PFGC’s case. Affiliated Managers Group, Inc. (NYSE:AMG) is the most popular stock in this table. On the other hand Duolingo Inc. (NASDAQ:DUOL) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Performance Food Group Company (NYSE:PFGC) is more popular among hedge funds. Our overall hedge fund sentiment score for PFGC is 76.3. 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Unfortunately PFGC wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on PFGC were disappointed as the stock returned -13.2% since the end of the third quarter (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 since 2019.
Follow Performance Food Group Co (NYSE:PFGC)
Follow Performance Food Group Co (NYSE:PFGC)
Suggested Articles:
- Billionaire Izzy Englander’s Top 10 Stock Picks
- 30 Dividend Kings of 2021 (Part I)
- 11 Best Lithium Stocks To Buy Now
Disclosure: None. This article was originally published at Insider Monkey.
