We at Insider Monkey have gone over 738 13F filings that hedge funds and famous value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article we look at what those investors think of Veritiv Corp (NYSE:VRTV).
Is Veritiv Corp (NYSE:VRTV) a buy, sell, or hold? Prominent investors are in an optimistic mood. The number of long hedge fund positions inched up by 2 in recent months. Our calculations also showed that vrtv isn’t among the 30 most popular stocks among hedge funds. VRTV was in 12 hedge funds’ portfolios at the end of March. There were 10 hedge funds in our database with VRTV positions at the end of the previous quarter.
To most stock holders, hedge funds are seen as slow, old investment vehicles of years past. While there are greater than 8000 funds trading today, Our experts look at the top tier of this club, about 750 funds. It is estimated that this group of investors preside over the lion’s share of all hedge funds’ total asset base, and by tailing their unrivaled equity investments, Insider Monkey has determined numerous investment strategies that have historically outstripped the market. Insider Monkey’s flagship hedge fund strategy exceeded the S&P 500 index by around 5 percentage points a year since its inception in May 2014 through June 18th. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 28.2% since February 2017 (through June 18th) even though the market was up nearly 30% during the same period. We just shared a list of 5 short targets in our latest quarterly update and they are already down an average of 8.2% in a month whereas our long picks outperformed the market by 2.5 percentage points in this volatile 5 week period (our long picks also beat the market by 15 percentage points so far this year).
Let’s take a look at the key hedge fund action surrounding Veritiv Corp (NYSE:VRTV).
How have hedgies been trading Veritiv Corp (NYSE:VRTV)?
Heading into the second quarter of 2019, a total of 12 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 20% from the previous quarter. The graph below displays the number of hedge funds with bullish position in VRTV over the last 15 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Seth Klarman’s Baupost Group has the biggest position in Veritiv Corp (NYSE:VRTV), worth close to $93.8 million, amounting to 0.8% of its total 13F portfolio. The second largest stake is held by Jim Simons of Renaissance Technologies, with a $2 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors that hold long positions comprise D. E. Shaw’s D E Shaw, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Cliff Asness’s AQR Capital Management.
As industrywide interest jumped, key money managers have been driving this bullishness. Renaissance Technologies, managed by Jim Simons, established the most valuable position in Veritiv Corp (NYSE:VRTV). Renaissance Technologies had $2 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also initiated a $1.1 million position during the quarter. The other funds with brand new VRTV positions are Paul Marshall and Ian Wace’s Marshall Wace LLP, Mike Vranos’s Ellington, and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s now review hedge fund activity in other stocks similar to Veritiv Corp (NYSE:VRTV). We will take a look at Limoneira Company (NASDAQ:LMNR), Cellcom Israel Ltd. (NYSE:CEL), Hibbett Sports, Inc. (NASDAQ:HIBB), and America First Multifamily Investors, L.P. (NASDAQ:ATAX). This group of stocks’ market values are closest to VRTV’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LMNR | 2 | 8529 | -2 |
| CEL | 2 | 14426 | 0 |
| HIBB | 15 | 113528 | 0 |
| ATAX | 2 | 1764 | 1 |
| Average | 5.25 | 34562 | -0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.25 hedge funds with bullish positions and the average amount invested in these stocks was $35 million. That figure was $102 million in VRTV’s case. Hibbett Sports, Inc. (NASDAQ:HIBB) is the most popular stock in this table. On the other hand Limoneira Company (NASDAQ:LMNR) is the least popular one with only 2 bullish hedge fund positions. Veritiv Corp (NYSE:VRTV) 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 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately VRTV wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on VRTV were disappointed as the stock returned -27.9% during the same period 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 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.
