The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 887 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of December 31st. In this article we look at what those investors think of Jacobs Engineering Group Inc. (NYSE:J).
Is J stock a buy? Jacobs Engineering Group Inc. (NYSE:J) has experienced an increase in activity from the world’s largest hedge funds recently. Jacobs Engineering Group Inc. (NYSE:J) was in 30 hedge funds’ portfolios at the end of December. The all time high for this statistic is 35. There were 27 hedge funds in our database with J positions at the end of the third quarter. Our calculations also showed that J isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).
Robert Pohly of Samlyn Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we heard that billionaire Peter Thiel is backing this psychedelic-drug startup. So, we are taking a closer look at this space. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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 website. With all of this in mind we’re going to take a peek at the new hedge fund action encompassing Jacobs Engineering Group Inc. (NYSE:J).
Do Hedge Funds Think J Is A Good Stock To Buy Now?
At the end of the fourth quarter, a total of 30 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 11% from the third quarter of 2020. Below, you can check out the change in hedge fund sentiment towards J over the last 22 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Jacobs Engineering Group Inc. (NYSE:J) was held by Select Equity Group, which reported holding $648.5 million worth of stock at the end of December. It was followed by Empyrean Capital Partners with a $115.1 million position. Other investors bullish on the company included Suvretta Capital Management, Samlyn Capital, and Fir Tree. In terms of the portfolio weights assigned to each position Empyrean Capital Partners allocated the biggest weight to Jacobs Engineering Group Inc. (NYSE:J), around 3.77% of its 13F portfolio. Bourgeon Capital is also relatively very bullish on the stock, designating 2.84 percent of its 13F equity portfolio to J.
Consequently, specific money managers have jumped into Jacobs Engineering Group Inc. (NYSE:J) headfirst. Suvretta Capital Management, managed by Aaron Cowen, assembled the most outsized position in Jacobs Engineering Group Inc. (NYSE:J). Suvretta Capital Management had $50.7 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also initiated a $4.2 million position during the quarter. The other funds with brand new J positions are Blair Baker’s Precept Capital Management, D. E. Shaw’s D E Shaw, and Noam Gottesman’s GLG Partners.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Jacobs Engineering Group Inc. (NYSE:J) but similarly valued. These stocks are Plug Power, Inc. (NASDAQ:PLUG), Avangrid, Inc. (NYSE:AGR), Cincinnati Financial Corporation (NASDAQ:CINF), Cognex Corporation (NASDAQ:CGNX), Godaddy Inc (NYSE:GDDY), Imperial Oil Limited (NYSE:IMO), and PTC Inc (NASDAQ:PTC). This group of stocks’ market values are similar to J’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PLUG | 21 | 734364 | 0 |
| AGR | 10 | 64954 | -1 |
| CINF | 20 | 842405 | 1 |
| CGNX | 31 | 382597 | 3 |
| GDDY | 44 | 2610164 | 0 |
| IMO | 8 | 20725 | -3 |
| PTC | 38 | 1802897 | -1 |
| Average | 24.6 | 922587 | -0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 24.6 hedge funds with bullish positions and the average amount invested in these stocks was $923 million. That figure was $1038 million in J’s case. Godaddy Inc (NYSE:GDDY) is the most popular stock in this table. On the other hand Imperial Oil Limited (NYSE:IMO) is the least popular one with only 8 bullish hedge fund positions. Jacobs Engineering Group Inc. (NYSE:J) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for J is 64.3. 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 12.2% in 2021 through April 12th and still beat the market by 1.5 percentage points. Hedge funds were also right about betting on J as the stock returned 23.6% since the end of Q4 (through 4/12) 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.
