At Insider Monkey, we pore over the filings of nearly 867 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 September 30th. In this article, we will use that wealth of knowledge to determine whether or not Shaw Communications Inc (NYSE:SJR) makes for a good investment right now.
Shaw Communications Inc (NYSE:SJR) was in 21 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 23. SJR has experienced a decrease in activity from the world’s largest hedge funds in recent months. There were 23 hedge funds in our database with SJR positions at the end of the second quarter. Our calculations also showed that SJR isn’t among the 30 most popular stocks among hedge funds (click for Q2 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 encompassing Shaw Communications Inc (NYSE:SJR).
Seth Klarman of Baupost Group
Do Hedge Funds Think SJR Is A Good Stock To Buy Now?
At the end of September, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -9% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards SJR over the last 25 quarters. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
Among these funds, Baupost Group held the most valuable stake in Shaw Communications Inc (NYSE:SJR), which was worth $218.7 million at the end of the third quarter. On the second spot was Magnetar Capital which amassed $148.1 million worth of shares. Millennium Management, Canyon Capital Advisors, and Renaissance Technologies 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 NewGen Asset Management allocated the biggest weight to Shaw Communications Inc (NYSE:SJR), around 12.1% of its 13F portfolio. Odey Asset Management Group is also relatively very bullish on the stock, designating 9.75 percent of its 13F equity portfolio to SJR.
Seeing as Shaw Communications Inc (NYSE:SJR) has faced falling interest from the aggregate hedge fund industry, it’s safe to say that there were a few funds that elected to cut their full holdings heading into Q4. Intriguingly, Simon Sadler’s Segantii Capital sold off the largest investment of the “upper crust” of funds followed by Insider Monkey, worth about $20.2 million in stock, and D. E. Shaw’s D E Shaw was right behind this move, as the fund dumped about $19.3 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 2 funds heading into Q4.
Let’s now review hedge fund activity in other stocks similar to Shaw Communications Inc (NYSE:SJR). We will take a look at The Interpublic Group of Companies Inc (NYSE:IPG), monday.com Ltd. (NASDAQ:MNDY), Equity Lifestyle Properties, Inc. (NYSE:ELS), RH (NYSE:RH), Evergy, Inc. (NYSE:EVRG), Vedanta Ltd (NYSE:VEDL), and SentinelOne, Inc. (NYSE:S). This group of stocks’ market caps match SJR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IPG | 31 | 643159 | 0 |
| MNDY | 17 | 495191 | 17 |
| ELS | 25 | 462091 | 0 |
| RH | 57 | 4990440 | 3 |
| EVRG | 25 | 908059 | 4 |
| VEDL | 8 | 25575 | -2 |
| S | 35 | 2234141 | -32 |
| Average | 28.3 | 1394094 | -1.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 28.3 hedge funds with bullish positions and the average amount invested in these stocks was $1394 million. That figure was $893 million in SJR’s case. RH (NYSE:RH) is the most popular stock in this table. On the other hand Vedanta Ltd (NYSE:VEDL) is the least popular one with only 8 bullish hedge fund positions. Shaw Communications Inc (NYSE:SJR) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for SJR is 43.7. 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 29.6% in 2021 and surpassed the market again by 3.6 percentage points. Unfortunately SJR wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); SJR investors were disappointed as the stock returned 5.3% since the end of September (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 in 2021.
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Disclosure: None. This article was originally published at Insider Monkey.
