In this article you are going to find out whether hedge funds think Corning Incorporated (NYSE:GLW) is a good investment right now. We like to check what the smart money thinks first before doing extensive research on a given stock. 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 predict the winners in the stock market.
Is GLW stock a buy or sell? Money managers were in a bullish mood. The number of bullish hedge fund positions improved by 3 recently. Corning Incorporated (NYSE:GLW) was in 39 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 41. Our calculations also showed that GLW isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
David Siegel of Two Sigma Advisors
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Do Hedge Funds Think GLW Is A Good Stock To Buy Now?
At fourth quarter’s end, a total of 39 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 8% from the previous quarter. By comparison, 35 hedge funds held shares or bullish call options in GLW a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).
More specifically, Millennium Management was the largest shareholder of Corning Incorporated (NYSE:GLW), with a stake worth $62 million reported as of the end of December. Trailing Millennium Management was Arrowstreet Capital, which amassed a stake valued at $61.4 million. Yacktman Asset Management, Adage Capital Management, and Citadel Investment Group were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Fairpointe Capital allocated the biggest weight to Corning Incorporated (NYSE:GLW), around 3.46% of its 13F portfolio. Beech Hill Partners is also relatively very bullish on the stock, dishing out 1.95 percent of its 13F equity portfolio to GLW.
Now, key money managers were leading the bulls’ herd. Two Sigma Advisors, managed by John Overdeck and David Siegel, initiated the largest position in Corning Incorporated (NYSE:GLW). Two Sigma Advisors had $6.6 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also made a $4.2 million investment in the stock during the quarter. The other funds with brand new GLW positions are Thomas Lee’s Lee Capital Management, Qing Li’s Sciencast Management, and Minhua Zhang’s Weld Capital Management.
Let’s go over hedge fund activity in other stocks similar to Corning Incorporated (NYSE:GLW). These stocks are Splunk Inc (NASDAQ:SPLK), NatWest Group plc (NYSE:NWG), Nutrien Ltd. (NYSE:NTR), Willis Towers Watson Public Limited Company (NASDAQ:WLTW), Mettler-Toledo International Inc. (NYSE:MTD), Sirius XM Holdings Inc (NASDAQ:SIRI), and AutoZone, Inc. (NYSE:AZO). This group of stocks’ market valuations are similar to GLW’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SPLK | 47 | 1036156 | 3 |
| NWG | 3 | 759 | 1 |
| NTR | 25 | 754698 | -1 |
| WLTW | 58 | 3245691 | 7 |
| MTD | 29 | 850200 | -1 |
| SIRI | 32 | 670253 | -5 |
| AZO | 44 | 1445833 | -9 |
| Average | 34 | 1143370 | -0.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 34 hedge funds with bullish positions and the average amount invested in these stocks was $1143 million. That figure was $335 million in GLW’s case. Willis Towers Watson Public Limited Company (NASDAQ:WLTW) is the most popular stock in this table. On the other hand NatWest Group plc (NYSE:NWG) is the least popular one with only 3 bullish hedge fund positions. Corning Incorporated (NYSE:GLW) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GLW is 69.3. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 5.3% in 2021 through March 19th and still beat the market by 0.8 percentage points. Hedge funds were also right about betting on GLW as the stock returned 15.4% since the end of Q4 (through 3/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
