The Western Union Company (WU): Hedge Funds Are Snapping Up

With the second-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the third quarter of 2021. One of these stocks was The Western Union Company (NYSE:WU).

The Western Union Company (NYSE:WU) has experienced an increase in support from the world’s most elite money managers of late. The Western Union Company (NYSE:WU) was in 31 hedge funds’ portfolios at the end of June. The all time high for this statistic is 36. Our calculations also showed that WU isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

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David Siegel of Two Sigma Advisors

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Do Hedge Funds Think WU Is A Good Stock To Buy Now?

At Q2’s end, a total of 31 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 11% from the first quarter of 2020. Below, you can check out the change in hedge fund sentiment towards WU over the last 24 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to Insider Monkey’s hedge fund database, 0, managed by John Overdeck and David Siegel, holds the most valuable position in The Western Union Company (NYSE:WU). Two Sigma Advisors has a $112.4 million position in the stock, comprising 0.3% of its 13F portfolio. Sitting at the No. 2 spot is 0, managed by D. E. Shaw, which holds a $103.8 million position; 0.1% of its 13F portfolio is allocated to the stock. Other peers that hold long positions comprise Peter Rathjens, Bruce Clarke and John Campbell’s 0, Cliff Asness’s 0 and Israel Englander’s 0. In terms of the portfolio weights assigned to each position Neo Ivy Capital allocated the biggest weight to The Western Union Company (NYSE:WU), around 0.88% of its 13F portfolio. TwinBeech Capital is also relatively very bullish on the stock, setting aside 0.38 percent of its 13F equity portfolio to WU.

Consequently, some big names were leading the bulls’ herd. Bridgewater Associates, managed by Ray Dalio, initiated the most valuable position in The Western Union Company (NYSE:WU). Bridgewater Associates had $1.6 million invested in the company at the end of the quarter. Karim Abbadi and Edward McBride’s Centiva Capital also made a $1.2 million investment in the stock during the quarter. The following funds were also among the new WU investors: Qing Li’s Sciencast Management, Renee Yao’s Neo Ivy Capital, and Greg Poole’s Echo Street Capital Management.

Let’s go over hedge fund activity in other stocks similar to The Western Union Company (NYSE:WU). We will take a look at Guidewire Software Inc (NYSE:GWRE), Aspen Technology, Inc. (NASDAQ:AZPN), Store Capital Corporation (NYSE:STOR), CubeSmart (NYSE:CUBE), Alleghany Corporation (NYSE:Y), AECOM (NYSE:ACM), and AptarGroup, Inc. (NYSE:ATR). This group of stocks’ market values are closest to WU’s market value.

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 $753 million. That figure was $370 million in WU’s case. Alleghany Corporation (NYSE:Y) is the most popular stock in this table. On the other hand Store Capital Corporation (NYSE:STOR) is the least popular one with only 13 bullish hedge fund positions. The Western Union Company (NYSE:WU) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for WU is 81.2. 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 positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 24.9% in 2021 through October 15th and beat the market again by 4.5 percentage points. Unfortunately WU wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on WU were disappointed as the stock returned -6.4% since the end of June (through 10/15) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.

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Disclosure: None. This article was originally published at Insider Monkey.