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 Kimberly Clark Corporation (NYSE:KMB).
Is KMB stock a buy? The best stock pickers were taking a pessimistic view. The number of long hedge fund positions went down by 4 recently. Kimberly Clark Corporation (NYSE:KMB) was in 37 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 46. Our calculations also showed that KMB isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings). There were 41 hedge funds in our database with KMB holdings at the end of September.
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).
John Overdeck of Two Sigma Advisors
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 10 best battery stocks to buy 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. Keeping this in mind let’s take a peek at the fresh hedge fund action encompassing Kimberly Clark Corporation (NYSE:KMB).
Do Hedge Funds Think KMB Is A Good Stock To Buy Now?
At Q4’s end, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from the previous quarter. On the other hand, there were a total of 37 hedge funds with a bullish position in KMB a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Diamond Hill Capital held the most valuable stake in Kimberly Clark Corporation (NYSE:KMB), which was worth $278.9 million at the end of the fourth quarter. On the second spot was Arrowstreet Capital which amassed $250.8 million worth of shares. Two Sigma Advisors, AQR Capital Management, and Millennium Management 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 Diamond Hill Capital allocated the biggest weight to Kimberly Clark Corporation (NYSE:KMB), around 1.31% of its 13F portfolio. Te Ahumairangi Investment Management is also relatively very bullish on the stock, earmarking 0.76 percent of its 13F equity portfolio to KMB.
Due to the fact that Kimberly Clark Corporation (NYSE:KMB) has witnessed a decline in interest from hedge fund managers, it’s easy to see that there exists a select few hedge funds that elected to cut their positions entirely by the end of the fourth quarter. Intriguingly, Parvinder Thiara’s Athanor Capital dumped the biggest investment of the 750 funds monitored by Insider Monkey, totaling an estimated $4.9 million in stock, and Matthew Hulsizer’s PEAK6 Capital Management was right behind this move, as the fund sold off about $2.6 million worth. These bearish behaviors are interesting, as total hedge fund interest was cut by 4 funds by the end of the fourth quarter.
Let’s go over hedge fund activity in other stocks similar to Kimberly Clark Corporation (NYSE:KMB). We will take a look at Las Vegas Sands Corp. (NYSE:LVS), Lululemon Athletica inc. (NASDAQ:LULU), DoorDash, Inc. (NYSE:DASH), Capital One Financial Corp. (NYSE:COF), Roper Technologies Inc. (NYSE:ROP), Keurig Dr Pepper Inc. (NASDAQ:KDP), and The Blackstone Group Inc. (NYSE:BX). This group of stocks’ market valuations are similar to KMB’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LVS | 63 | 3065977 | 16 |
| LULU | 50 | 929013 | 0 |
| DASH | 38 | 3952490 | 38 |
| COF | 56 | 3028457 | 14 |
| ROP | 40 | 1348849 | -10 |
| KDP | 29 | 1076705 | -12 |
| BX | 54 | 1450344 | 5 |
| Average | 47.1 | 2121691 | 7.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 47.1 hedge funds with bullish positions and the average amount invested in these stocks was $2122 million. That figure was $1420 million in KMB’s case. Las Vegas Sands Corp. (NYSE:LVS) is the most popular stock in this table. On the other hand Keurig Dr Pepper Inc. (NASDAQ:KDP) is the least popular one with only 29 bullish hedge fund positions. Kimberly Clark Corporation (NYSE:KMB) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for KMB is 36.9. 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. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. 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 7.9% in 2021 through April 1st and surpassed the market again by 0.4 percentage points. Unfortunately KMB wasn’t nearly as popular as these 30 stocks (hedge fund sentiment was quite bearish); KMB investors were disappointed as the stock returned 2.5% since the end of December (through 4/1) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Follow Kimberly Clark Corp (NYSE:KMB)
Follow Kimberly Clark Corp (NYSE:KMB)
Disclosure: None. This article was originally published at Insider Monkey.
