Is Fidelity National Information Services (NYSE:FIS) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.
Fidelity National Information Services (NYSE:FIS) shareholders have witnessed an increase in hedge fund sentiment in recent months, as the stock was in 49 hedge funds’ portfolios at the end of the third quarter of 2016, compared to 47 funds a quarter earlier. At the end of this article we will also compare FIS to other stocks including Zimmer Biomet Holdings Inc (NYSE:ZBH), Valero Energy Corporation (NYSE:VLO), and Consolidated Edison, Inc. (NYSE:ED) to get a better sense of its popularity.
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Hedge fund activity in Fidelity National Information Services (NYSE:FIS)
A total of 49 funds tracked by Insider Monkey held shares of Fidelity National Information Services at the end of September, up by 4% sequentially. Hedge fund ownership has been very stable since a large spike in hedgie positions in Q4 2015. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, William von Mueffling’s Cantillon Capital Management holds the biggest position in Fidelity National Information Services (NYSE:FIS). Cantillon Capital Management has a $578.8 million position in the stock, comprising 8.2% of its 13F portfolio. The second largest stake is held by OZ Management, led by Daniel S. Och, which holds a $323.9 million position; 1.9% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions consist of Boykin Curry’s Eagle Capital Management, Israel Englander’s Millennium Management, and David E. Shaw’s D E Shaw.
As aggregate interest increased, some big names have jumped into Fidelity National Information Services (NYSE:FIS) headfirst. Brookside Capital, managed by Bain Capital, established the largest position in Fidelity National Information Services (NYSE:FIS). Brookside Capital had $78.1 million invested in the company at the end of the quarter. David Gallo’s Valinor Management LLC also made a $68.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Matthew Tewksbury’s Stevens Capital Management, Paul Tudor Jones’ Tudor Investment Corp, and Ira Unschuld’s Brant Point Investment Management.
Let’s now review hedge fund activity in other stocks similar to Fidelity National Information Services (NYSE:FIS). These stocks are Zimmer Biomet Holdings Inc (NYSE:ZBH), Valero Energy Corporation (NYSE:VLO), Consolidated Edison, Inc. (NYSE:ED), and Public Service Enterprise Group Inc. (NYSE:PEG). This group of stocks’ market valuations are similar to FIS’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ZBH | 44 | 1547131 | 7 |
| VLO | 42 | 860326 | 0 |
| ED | 23 | 513331 | 9 |
| PEG | 20 | 604657 | -2 |
As you can see these stocks had an average of 32 funds with bullish positions and the average amount invested in these stocks was $881 million. That figure was $2.87 billion in FIS’s case. Zimmer Biomet Holdings Inc (NYSE:ZBH) is the most popular stock in this table. On the other hand Public Service Enterprise Group Inc. (NYSE:PEG) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks Fidelity National Information Services (NYSE:FIS) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: None
