Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track more than 700 prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile gigantic failures like hedge funds’ recent losses in Valeant. Let’s take a closer look at what the funds we track think about Equifax Inc. (NYSE:EFX) in this article.
Equifax Inc. (NYSE:EFX) has experienced an increase in enthusiasm from smart money lately. 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 Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA), Genuine Parts Company (NYSE:GPC), and Northern Trust Corporation (NASDAQ:NTRS) to gather more data points.
Follow Equifax Inc (NYSE:EFX)
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At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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With all of this in mind, let’s review the key action regarding Equifax Inc. (NYSE:EFX).
What does the smart money think about Equifax Inc. (NYSE:EFX)?
At the end of the third quarter, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 31% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were boosting their stakes 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 number one position in Equifax Inc. (NYSE:EFX). AQR Capital Management has a $127.4 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is Columbus Circle Investors, managed by Principal Global Investors, which holds a $89.9 million position; the fund has 1% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish encompass Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Ken Fisher’s Fisher Asset Management.
Now, some big names were leading the bulls’ herd. Harbor Spring Capital, managed by Amit Nitin Doshi, assembled the most valuable position in Equifax Inc. (NYSE:EFX). Harbor Spring Capital had $37 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also initiated a $23.9 million position during the quarter. The following funds were also among the new EFX investors: Robert Pohly’s Samlyn Capital, Clint Carlson’s Carlson Capital, and George Hall’s Clinton Group.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Equifax Inc. (NYSE:EFX) but similarly valued. We will take a look at Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA), Genuine Parts Company (NYSE:GPC), Northern Trust Corporation (NASDAQ:NTRS), and TD Ameritrade Holding Corp. (NYSE:AMTD). This group of stocks’ market values are similar to EFX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ULTA | 40 | 2044715 | 4 |
| GPC | 23 | 347677 | 1 |
| NTRS | 30 | 486076 | 3 |
| AMTD | 17 | 290831 | 4 |
As you can see these stocks had an average of 27.5 hedge funds with bullish positions and the average amount invested in these stocks was $792 million. That figure was $529 million in EFX’s case. Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA) is the most popular stock in this table. On the other hand TD Ameritrade Holding Corp. (NYSE:AMTD) is the least popular one with only 17 bullish hedge fund positions. Equifax Inc. (NYSE:EFX) 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 ULTA might be a better candidate to consider a long position.
