With the first-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the second quarter. One of these stocks was Woodward Inc (NASDAQ:WWD).
Is Woodward Inc (NASDAQ:WWD) a buy here? Prominent investors are getting more optimistic. The number of bullish hedge fund bets improved by 8 lately. Our calculations also showed that WWD isn’t among the 30 most popular stocks among hedge funds (view the video below).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
Today there are a large number of gauges shareholders have at their disposal to evaluate publicly traded companies. A duo of the most innovative gauges are hedge fund and insider trading signals. We have shown that, historically, those who follow the top picks of the elite investment managers can trounce their index-focused peers by a very impressive amount (see the details here).
Unlike some fund managers who are betting on Dow reaching 40000 in a year, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s check out the key hedge fund action encompassing Woodward Inc (NASDAQ:WWD).
What does smart money think about Woodward Inc (NASDAQ:WWD)?
At Q2’s end, a total of 28 of the hedge funds tracked by Insider Monkey were long this stock, a change of 40% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards WWD over the last 16 quarters. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
Among these funds, Royce & Associates held the most valuable stake in Woodward Inc (NASDAQ:WWD), which was worth $80.1 million at the end of the second quarter. On the second spot was AQR Capital Management which amassed $78.8 million worth of shares. Moreover, Millennium Management, Citadel Investment Group, and Shellback Capital were also bullish on Woodward Inc (NASDAQ:WWD), allocating a large percentage of their portfolios to this stock.
Consequently, specific money managers were breaking ground themselves. Shellback Capital, managed by Doug Gordon, Jon Hilsabeck and Don Jabro, established the largest position in Woodward Inc (NASDAQ:WWD). Shellback Capital had $19.7 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made a $8.4 million investment in the stock during the quarter. The following funds were also among the new WWD investors: Andrew Sandler’s Sandler Capital Management, Richard Chilton’s Chilton Investment Company, and Steve Cohen’s Point72 Asset Management.
Let’s now review hedge fund activity in other stocks similar to Woodward Inc (NASDAQ:WWD). We will take a look at bluebird bio Inc (NASDAQ:BLUE), First Solar, Inc. (NASDAQ:FSLR), PVH Corp (NYSE:PVH), and Hill-Rom Holdings, Inc. (NYSE:HRC). This group of stocks’ market values match WWD’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BLUE | 22 | 155991 | -3 |
| FSLR | 24 | 372192 | 1 |
| PVH | 32 | 1066193 | 1 |
| HRC | 27 | 627642 | -2 |
| Average | 26.25 | 555505 | -0.75 |
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 $556 million. That figure was $353 million in WWD’s case. PVH Corp (NYSE:PVH) is the most popular stock in this table. On the other hand bluebird bio Inc (NASDAQ:BLUE) is the least popular one with only 22 bullish hedge fund positions. Woodward Inc (NASDAQ:WWD) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately WWD wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on WWD were disappointed as the stock returned -4.6% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.
