The 700+ hedge funds and money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund positions. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Sherwin-Williams Company (NYSE:SHW).
Sherwin-Williams Company (NYSE:SHW) was in 45 hedge funds’ portfolios at the end of September. SHW investors should be aware of an increase in enthusiasm from smart money lately. There were 35 hedge funds in our database with SHW 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 Cerner Corporation (NASDAQ:CERN), Zoetis Inc (NYSE:ZTS), and Edison International (NYSE:EIX) to gather more data points.
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To the average investor there are tons of indicators stock market investors employ to value their holdings. A duo of the most underrated indicators are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the top picks of the best fund managers can trounce the market by a significant margin (see the details here).
Keeping this in mind, we’re going to take a look at the new action regarding Sherwin-Williams Company (NYSE:SHW).
What does the smart money think about Sherwin-Williams Company (NYSE:SHW)?
At the end of the third quarter, a total of 45 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 29% from one quarter earlier. With the smart money’s capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Eton Park Capital, managed by Eric Mindich, holds the most valuable position in Sherwin-Williams Company (NYSE:SHW). Eton Park Capital has a $249 million position in the stock, comprising 4.3% of its 13F portfolio. Coming in second is Robert Joseph Caruso of Select Equity Group, with a $226.9 million position; 2.2% of its 13F portfolio is allocated to the company. Other professional money managers with similar optimism comprise Eric Mindich’s Eton Park Capital, Paul Marshall and Ian Wace’s Marshall Wace LLP and Richard Chilton’s Chilton Investment Company.
Consequently, some big names have been driving this bullishness. Eton Park Capital, managed by Eric Mindich, initiated the biggest position in Sherwin-Williams Company (NYSE:SHW). Eton Park Capital had $249 million invested in the company at the end of the quarter. Eric Mindich’s Eton Park Capital also made an $155.9 million investment in the stock during the quarter. The following funds were also among the new SHW investors: John Overdeck and David Siegel’s Two Sigma Advisors, Daniel S. Och’s OZ Management, and David Harding’s Winton Capital Management.
Let’s check out hedge fund activity in other stocks similar to Sherwin-Williams Company (NYSE:SHW). We will take a look at Cerner Corporation (NASDAQ:CERN), Zoetis Inc (NYSE:ZTS), Edison International (NYSE:EIX), and AmerisourceBergen Corp. (NYSE:ABC). This group of stocks’ market values resemble SHW’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CERN | 29 | 355764 | 2 |
| ZTS | 60 | 4283577 | -10 |
| EIX | 22 | 706884 | -6 |
| ABC | 38 | 1031663 | -1 |
As you can see these stocks had an average of 37 hedge funds with bullish positions and the average amount invested in these stocks was $1.59 billion. Zoetis Inc (NYSE:ZTS) is the most popular stock in this table with 60 funds reporting stakes as of September 30, while Edison International (NYSE:EIX) is the least popular one with only 22 bullish hedge fund positions. With hedge funds reporting stakes worth $1.61 billion in aggregate, Sherwin-Williams Company (NYSE:SHW) 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. In this regard ZTS might be a better candidate to consider a long position.
