Hedge funds and large money managers usually invest with a focus on the long-term horizon and, therefore, short-lived dips or bumps on the charts usually don’t make them change their opinion towards a company. This time it may be different. The coronavirus pandemic destroyed the high correlations among major industries and asset classes. We are now in a stock pickers market where fundamentals of a stock have more effect on the price than the overall direction of the market. As a result we observe sudden and large changes in hedge fund positions depending on the news flow. Let’s take a look at the hedge fund sentiment towards Hancock Whitney Corporation (NASDAQ:HWC) to find out whether there were any major changes in hedge funds’ views.
Is Hancock Whitney Corporation (NASDAQ:HWC) a bargain? Hedge funds were becoming more confident. The number of long hedge fund positions inched up by 7 recently. Hancock Whitney Corporation (NASDAQ:HWC) was in 22 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 24. Our calculations also showed that HWC isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 15 hedge funds in our database with HWC holdings at the end of March.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Ryan Tolkin, CIO of Schonfeld Strategic Advisors
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. With all of this in mind we’re going to take a look at the latest hedge fund action regarding Hancock Whitney Corporation (NASDAQ:HWC).
Do Hedge Funds Think HWC Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 47% from one quarter earlier. By comparison, 23 hedge funds held shares or bullish call options in HWC a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
More specifically, Holocene Advisors was the largest shareholder of Hancock Whitney Corporation (NASDAQ:HWC), with a stake worth $28.8 million reported as of the end of June. Trailing Holocene Advisors was Citadel Investment Group, which amassed a stake valued at $18.2 million. Schonfeld Strategic Advisors, Forest Hill Capital, and GLG Partners 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 Forest Hill Capital allocated the biggest weight to Hancock Whitney Corporation (NASDAQ:HWC), around 3.9% of its 13F portfolio. Elizabeth Park Capital Management is also relatively very bullish on the stock, dishing out 1.8 percent of its 13F equity portfolio to HWC.
With a general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Elizabeth Park Capital Management, managed by Fred Cummings, created the most outsized position in Hancock Whitney Corporation (NASDAQ:HWC). Elizabeth Park Capital Management had $4.7 million invested in the company at the end of the quarter. Gregg Moskowitz’s Interval Partners also made a $3.2 million investment in the stock during the quarter. The other funds with brand new HWC positions are Matthew Hulsizer’s PEAK6 Capital Management, Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital), and Michael Gelband’s ExodusPoint Capital.
Let’s go over hedge fund activity in other stocks similar to Hancock Whitney Corporation (NASDAQ:HWC). These stocks are Digitalbridge Group Inc (NYSE:DBRG), Editas Medicine, Inc. (NASDAQ:EDIT), Eastern Bankshares, Inc. (NASDAQ:EBC), Denbury Inc. (NYSE:DEN), Southwest Gas Holdings, Inc. (NYSE:SWX), Southwestern Energy Company (NYSE:SWN), and Turning Point Therapeutics, Inc. (NASDAQ:TPTX). This group of stocks’ market values are similar to HWC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DBRG | 29 | 686986 | 4 |
| EDIT | 23 | 506626 | -1 |
| EBC | 20 | 115205 | 6 |
| DEN | 29 | 996614 | -1 |
| SWX | 19 | 145257 | -4 |
| SWN | 27 | 257726 | 5 |
| TPTX | 28 | 646677 | -5 |
| Average | 25 | 479299 | 0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $479 million. That figure was $128 million in HWC’s case. Digitalbridge Group Inc (NYSE:DBRG) is the most popular stock in this table. On the other hand Southwest Gas Holdings, Inc. (NYSE:SWX) is the least popular one with only 19 bullish hedge fund positions. Hancock Whitney Corporation (NASDAQ:HWC) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for HWC is 52.5. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 24% in 2021 through October 22nd and still beat the market by 1.6 percentage points. A small number of hedge funds were also right about betting on HWC as the stock returned 16.1% since the end of the second quarter (through 10/22) and outperformed the market by an even larger margin.
Follow Hancock Whitney Corp (NASDAQ:HWC)
Follow Hancock Whitney Corp (NASDAQ:HWC)
Suggested Articles:
- 10 Best Stocks Under $10 in 2021
- Billionaire Mario Gabelli’s Top 10 Stock Picks
- 15 Biggest Oil Refining Companies
Disclosure: None. This article was originally published at Insider Monkey.
