Is Broadridge Financial Solutions, Inc. (BR) A Good Stock To Buy?

Before we spend many hours researching a company, we’d like to analyze what hedge funds and billionaire investors think of the stock first. We would like to do so because the elite investors’ consensus returns have been exceptional. The top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last 12 months ending in October 30. Sixty three percent of these 30 stocks outperformed the market. Although the elite funds occasionally have their duds, such as Micron and Anadarko Petroleum, which fell 50% and 26%, respectively during the same time period, the hedge fund picks seem to work on average. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Broadridge Financial Solutions, Inc. (NYSE:BR).

Is Broadridge Financial Solutions, Inc. (NYSE:BR) a great investment today? Hedge funds are in a bullish mood. The number of bullish hedge fund positions rose by 1 recently. BR was in 25 hedge funds’ portfolios at the end of the third quarter of 2015. There were 24 hedge funds in our database with BR 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 Iron Mountain Incorporated (NYSE:IRM), Western Gas Partners, LP (NYSE:WES), and Israel Chemicals Ltd. (NYSE:ICL) to gather more data points.

With all of this in mind, we’re going to go over the fresh action encompassing Broadridge Financial Solutions, Inc. (NYSE:BR).

Hedge fund activity in Broadridge Financial Solutions, Inc. (NYSE:BR)

At Q3’s end, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 4% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, AQR Capital Management, managed by Cliff Asness, holds the biggest position in Broadridge Financial Solutions, Inc. (NYSE:BR). AQR Capital Management has an $63.9 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Gotham Asset Management, led by Joel Greenblatt, holding an $50.4 million position; 0.5% of its 13F portfolio is allocated to the stock. Some other hedge funds and institutional investors that hold long positions comprise Jim Simons’ Renaissance Technologies, Israel Englander’s Millennium Management and Chuck Royce’s Royce & Associates.

Now, some big names have jumped into Broadridge Financial Solutions, Inc. (NYSE:BR) headfirst. LMR Partners, managed by Ben Levine, Andrew Manuel and Stefan Renold, created the largest position in Broadridge Financial Solutions, Inc. (NYSE:BR). LMR Partners had $4.7 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made an $3.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Neil Chriss’ Hutchin Hill Capital, Paul Tudor Jones’ Tudor Investment Corp, and Simon Sadler’s Segantii Capital.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Broadridge Financial Solutions, Inc. (NYSE:BR) but similarly valued. We will take a look at Iron Mountain Incorporated (NYSE:IRM), Western Gas Partners, LP (NYSE:WES), Israel Chemicals Ltd. (NYSE:ICL), and Msci Inc (NYSE:MSCI). This group of stocks’ market valuations are closest to BR’s market valuation.

As you can see these stocks had an average of 12.75 hedge funds with bullish positions and the average amount invested in these stocks was $408 million. That figure was $304 million in BR’s case. Msci Inc (NYSE:MSCI) is the most popular stock in this table. On the other hand Israel Chemicals Ltd. (NYSE:ICL) is the least popular one with only 5 bullish hedge fund positions. Broadridge Financial Solutions, Inc. (NYSE:BR) 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 MSCI might be a better candidate to consider a long position.