We at Insider Monkey have gone over 752 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. In this article, we look at what those funds think of Whirlpool Corporation (NYSE:WHR) based on that data. The only ETF with a significant allocation to WHR is currently SPDR S&P Homebuilders ETF (NYSE:XHB)
Whirlpool Corporation (NYSE:WHR) investors should pay attention to an increase in hedge fund sentiment of late. Our calculations also showed that WHR 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.
To the average investor there are numerous tools investors use to evaluate publicly traded companies. Some of the less utilized tools are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the top picks of the elite money managers can outclass their index-focused peers by a significant margin (see the details here).
Tom Gayner of Markel Gayner Asset Management
Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world’s most bearish hedge fund that’s more convinced than ever that a crash is coming, our long-short investment strategy doesn’t rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds‘ buy/sell signals. We’re going to review the fresh hedge fund action encompassing Whirlpool Corporation (NYSE:WHR).
Hedge fund activity in Whirlpool Corporation (NYSE:WHR)
At Q3’s end, a total of 28 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 47% from the second quarter of 2019. By comparison, 23 hedge funds held shares or bullish call options in WHR a year ago. With the smart money’s sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
The largest stake in Whirlpool Corporation (NYSE:WHR) was held by Greenhaven Associates, which reported holding $446.1 million worth of stock at the end of September. It was followed by Lyrical Asset Management with a $263.5 million position. Other investors bullish on the company included Marshall Wace, Markel Gayner Asset Management, and AQR Capital Management. In terms of the portfolio weights assigned to each position Greenhaven Associates allocated the biggest weight to Whirlpool Corporation (NYSE:WHR), around 9.02% of its portfolio. Albar Capital is also relatively very bullish on the stock, earmarking 4.9 percent of its 13F equity portfolio to WHR.
Now, key money managers have jumped into Whirlpool Corporation (NYSE:WHR) headfirst. Citadel Investment Group, managed by Ken Griffin, initiated the largest position in Whirlpool Corporation (NYSE:WHR). Citadel Investment Group had $17.2 million invested in the company at the end of the quarter. Javier Velazquez’s Albar Capital also initiated a $10.7 million position during the quarter. The following funds were also among the new WHR investors: Ken Heebner’s Capital Growth Management, Renaissance Technologies, and Benjamin A. Smith’s Laurion Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to Whirlpool Corporation (NYSE:WHR). We will take a look at Packaging Corporation Of America (NYSE:PKG), Reinsurance Group of America Inc (NYSE:RGA), PulteGroup, Inc. (NYSE:PHM), and NRG Energy Inc (NYSE:NRG). All of these stocks’ market caps are similar to WHR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PKG | 16 | 119433 | -5 |
| RGA | 25 | 476554 | -1 |
| PHM | 28 | 826294 | -3 |
| NRG | 46 | 1482443 | 4 |
| Average | 28.75 | 726181 | -1.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 28.75 hedge funds with bullish positions and the average amount invested in these stocks was $726 million. That figure was $979 million in WHR’s case. NRG Energy Inc (NYSE:NRG) is the most popular stock in this table. On the other hand Packaging Corporation Of America (NYSE:PKG) is the least popular one with only 16 bullish hedge fund positions. Whirlpool Corporation (NYSE:WHR) is not the least popular stock in this group but hedge fund interest is still below average. 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 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. Unfortunately WHR wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); WHR investors were disappointed as the stock returned -8.9% during the first two months of the fourth 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 70 percent of these stocks already outperformed the market in Q4.
Disclosure: None. This article was originally published at Insider Monkey.
