Hedge Funds Remain Committed to The Allstate Corporation (ALL)

Is The Allstate Corporation (NYSE:ALL) a good stock to buy right now? We at Insider Monkey like to examine what billionaires and hedge funds think of a company before doing days of research on it. Given their 2-and-20 payment structure, hedge funds have more resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also have numerous Ivy League graduates and MBAs on their staffs. Like everyone else, hedge funds perform poorly at times, but their consensus picks have historically outperformed the market after risk adjustments.

The Allstate Corporation (NYSE:ALL) shareholders have witnessed a decrease in enthusiasm from smart money recently. ALL was in 39 hedge funds’ portfolios at the end of September. There were 40 hedge funds in our database with ALL positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as AvalonBay Communities Inc (NYSE:AVB), SYSCO Corporation (NYSE:SYY), and Health Care REIT, Inc. (NYSE:HCN) to gather more data points.

In the eyes of most investors, hedge funds are perceived as unimportant, outdated financial vehicles of yesteryear. While there are greater than 8,000 funds in operation at the moment, our experts hone in on the leaders of this club, about 700 funds. These hedge fund managers command the lion’s share of the smart money’s total asset base, and by shadowing their highest performing picks, Insider Monkey has unearthed many investment strategies that have historically outstripped Mr. Market. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points annually for a decade in their back tests.

Keeping this in mind, we’re going to take a glance at the fresh action encompassing The Allstate Corporation (NYSE:ALL).

How are hedge funds trading The Allstate Corporation (NYSE:ALL)?

Heading into Q4, a total of 39 of the hedge funds tracked by Insider Monkey were bullish on this stock, a 3% slip from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their holdings substantially (or had already accumulated large positions).

Of the funds tracked by Insider Monkey, Cliff Asness’ AQR Capital Management has the largest position in The Allstate Corporation (NYSE:ALL), worth close to $291.2 million, accounting for 0.6% of its total 13F portfolio. The second-most bullish fund is Viking Global, led by Andreas Halvorsen, holding a $290 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Other peers with similar optimism include Ken Griffin’s Citadel Investment Group, David Harding’s Winton Capital Management, and John Overdeck and David Siegel’s Two Sigma Advisors.

Due to the fact that The Allstate Corporation (NYSE:ALL) has witnessed a declination in interest from the smart money, logic holds that there were a few hedgies that elected to cut their full holdings by the end of the third quarter. It’s worth mentioning that Renaissance Technologies said goodbye to the biggest investment of the 700 funds watched by Insider Monkey, totaling about $46.6 million in stock, and Michael Platt and William Reeves’ BlueCrest Capital Mgmt. was right behind this move, as the fund sold off about $6.8 million worth of shares. These transactions are interesting, as aggregate hedge fund interest fell by 1 fund by the end of the third quarter.

Let’s check out hedge fund activity in other stocks similar to The Allstate Corporation (NYSE:ALL). We will take a look at AvalonBay Communities Inc (NYSE:AVB), SYSCO Corporation (NYSE:SYY), Health Care REIT, Inc. (NYSE:HCN), and Norfolk Southern Corp. (NYSE:NSC). This group of stocks’ market caps resemble ALL’s market cap.

As you can see these stocks had an average of 27.75 hedge funds with bullish positions and the average amount invested in these stocks was $1.29 billion. That figure was $1.53 billion in ALL’s case. Norfolk Southern Corp. (NYSE:NSC) is the most popular stock in this table. On the other hand AvalonBay Communities Inc (NYSE:AVB) is the least popular one with only 24 bullish hedge fund positions. Compared to these stocks The Allstate Corporation (NYSE:ALL) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers and have more money invested in it than all but one of the other stocks, it may be a good idea to analyze it in detail and potentially include it in your portfolio.