We are still in an overall bull market and many stocks that smart money investors were piling into surged through the end of November. Among them, Facebook and Microsoft ranked among the top 3 picks and these stocks gained 54% and 51% respectively. Hedge funds’ top 3 stock picks returned 41.7% this year and beat the S&P 500 ETFs by 14 percentage points. Investing in index funds guarantees you average returns, not superior returns. We are looking to generate superior returns for our readers. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Amcor plc (NYSE:AMCR).
Amcor plc (NYSE:AMCR) investors should be aware of an increase in hedge fund sentiment recently. Our calculations also showed that AMCR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most stock holders, hedge funds are perceived as worthless, old investment vehicles of years past. While there are greater than 8000 funds with their doors open at present, We look at the top tier of this club, around 750 funds. These money managers handle the lion’s share of the smart money’s total capital, and by keeping track of their matchless picks, Insider Monkey has brought to light several investment strategies that have historically outpaced the market. Insider Monkey’s flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points per year since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .
David E. Shaw of D.E. Shaw
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds‘ buy/sell signals. Let’s view the recent hedge fund action regarding Amcor plc (NYSE:AMCR).
How have hedgies been trading Amcor plc (NYSE:AMCR)?
At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 33% from the second quarter of 2019. Below, you can check out the change in hedge fund sentiment towards AMCR over the last 17 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
The largest stake in Amcor plc (NYSE:AMCR) was held by D E Shaw, which reported holding $38.5 million worth of stock at the end of September. It was followed by Millennium Management with a $33 million position. Other investors bullish on the company included Echo Street Capital Management, Adage Capital Management, and Paloma Partners. In terms of the portfolio weights assigned to each position Echo Street Capital Management allocated the biggest weight to Amcor plc (NYSE:AMCR), around 0.35% of its 13F portfolio. ExodusPoint Capital is also relatively very bullish on the stock, dishing out 0.17 percent of its 13F equity portfolio to AMCR.
As industrywide interest jumped, specific money managers were breaking ground themselves. Millennium Management, managed by Israel Englander, created the most valuable position in Amcor plc (NYSE:AMCR). Millennium Management had $33 million invested in the company at the end of the quarter. Greg Poole’s Echo Street Capital Management also made a $20.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Michael Gelband’s ExodusPoint Capital, Benjamin A. Smith’s Laurion Capital Management, and Michael Platt and William Reeves’s BlueCrest Capital Mgmt..
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Amcor plc (NYSE:AMCR) but similarly valued. We will take a look at Teleflex Incorporated (NYSE:TFX), Maxim Integrated Products Inc. (NASDAQ:MXIM), Evergy, Inc. (NYSE:EVRG), and Loews Corporation (NYSE:L). This group of stocks’ market caps are similar to AMCR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TFX | 26 | 767534 | 1 |
| MXIM | 29 | 249444 | 1 |
| EVRG | 25 | 866687 | 0 |
| L | 25 | 224303 | 4 |
| Average | 26.25 | 526992 | 1.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.25 hedge funds with bullish positions and the average amount invested in these stocks was $527 million. That figure was $131 million in AMCR’s case. Maxim Integrated Products Inc. (NASDAQ:MXIM) is the most popular stock in this table. On the other hand Evergy, Inc. (NYSE:EVRG) is the least popular one with only 25 bullish hedge fund positions. Compared to these stocks Amcor plc (NYSE:AMCR) is even less popular than EVRG. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. A small number of hedge funds were also right about betting on AMCR, though not to the same extent, as the stock returned 6.4% during the fourth quarter (through 11/30) and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
