We can judge whether FMC Corporation (NYSE:FMC) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market when we factor in known risk factors.
Is FMC Corporation (NYSE:FMC) a bargain? The best stock pickers are becoming more confident. The number of bullish hedge fund positions improved by 7 recently. Our calculations also showed that FMC isn’t among the 30 most popular stocks among hedge funds (view the video below). FMC was in 36 hedge funds’ portfolios at the end of the second quarter of 2019. There were 29 hedge funds in our database with FMC positions at the end of the previous quarter.
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
At the moment there are dozens of metrics investors put to use to evaluate their stock investments. A couple of the most under-the-radar metrics are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the best picks of the best investment managers can trounce the S&P 500 by a superb amount (see the details here).
Unlike some fund managers who are betting on Dow reaching 40000 in a year, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. We’re going to take a look at the new hedge fund action encompassing FMC Corporation (NYSE:FMC).
What does smart money think about FMC Corporation (NYSE:FMC)?
At the end of the second quarter, a total of 36 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 24% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards FMC over the last 16 quarters. With hedgies’ sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
Among these funds, Glenview Capital held the most valuable stake in FMC Corporation (NYSE:FMC), which was worth $620.3 million at the end of the second quarter. On the second spot was Thunderbird Partners which amassed $212.1 million worth of shares. Moreover, Cardinal Capital, Millennium Management, and Holocene Advisors were also bullish on FMC Corporation (NYSE:FMC), allocating a large percentage of their portfolios to this stock.
As industrywide interest jumped, key hedge funds were leading the bulls’ herd. Renaissance Technologies established the most outsized position in FMC Corporation (NYSE:FMC). Renaissance Technologies had $34.5 million invested in the company at the end of the quarter. Jay Petschek and Steven Major’s Corsair Capital Management also made a $16.9 million investment in the stock during the quarter. The other funds with brand new FMC positions are Javier Velazquez’s Albar Capital, Karim Abbadi and Edward McBride’s Centiva Capital, and Louis Bacon’s Moore Global Investments.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as FMC Corporation (NYSE:FMC) but similarly valued. These stocks are Mohawk Industries, Inc. (NYSE:MHK), PerkinElmer, Inc. (NYSE:PKI), Vistra Energy Corp. (NYSE:VST), and Comerica Incorporated (NYSE:CMA). This group of stocks’ market values are similar to FMC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MHK | 33 | 1990526 | -1 |
| PKI | 24 | 971959 | -1 |
| VST | 39 | 2308414 | -9 |
| CMA | 32 | 509157 | -4 |
| Average | 32 | 1445014 | -3.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 32 hedge funds with bullish positions and the average amount invested in these stocks was $1445 million. That figure was $1206 million in FMC’s case. Vistra Energy Corp. (NYSE:VST) is the most popular stock in this table. On the other hand PerkinElmer, Inc. (NYSE:PKI) is the least popular one with only 24 bullish hedge fund positions. FMC Corporation (NYSE:FMC) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Hedge funds were also right about betting on FMC as the stock returned 6.2% during the third quarter and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.
