Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Chubb Limited (NYSE:CB) based on that data and determine whether they were really smart about the stock.
Chubb Limited (NYSE:CB) was in 30 hedge funds’ portfolios at the end of September. The all time high for this statistic is 50. CB has experienced a decrease in support from the world’s most elite money managers lately. There were 42 hedge funds in our database with CB positions at the end of the second quarter. Our calculations also showed that CB isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so 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. With all of this in mind we’re going to view the fresh hedge fund action surrounding Chubb Limited (NYSE:CB).
Ole Andreas Halvorsen of Viking Global
Do Hedge Funds Think CB Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 30 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -29% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in CB over the last 25 quarters. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Andreas Halvorsen’s Viking Global has the biggest position in Chubb Limited (NYSE:CB), worth close to $527.4 million, corresponding to 1.5% of its total 13F portfolio. Coming in second is Polar Capital, managed by Brian Ashford-Russell and Tim Woolley, which holds a $194.2 million position; 0.8% of its 13F portfolio is allocated to the company. Other members of the smart money that hold long positions encompass Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Cliff Asness’s AQR Capital Management and Phill Gross and Robert Atchinson’s Adage Capital Management. In terms of the portfolio weights assigned to each position Polaris Capital Management allocated the biggest weight to Chubb Limited (NYSE:CB), around 1.71% of its 13F portfolio. Prana Capital Management is also relatively very bullish on the stock, setting aside 1.67 percent of its 13F equity portfolio to CB.
Seeing as Chubb Limited (NYSE:CB) has experienced declining sentiment from hedge fund managers, logic holds that there were a few hedgies who sold off their full holdings in the third quarter. It’s worth mentioning that D. E. Shaw’s D E Shaw cut the largest position of the 750 funds tracked by Insider Monkey, totaling about $76.1 million in stock. Ryan Tolkin (CIO)’s fund, Schonfeld Strategic Advisors, also said goodbye to its stock, about $30.7 million worth. These transactions are interesting, as total hedge fund interest dropped by 12 funds in the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Chubb Limited (NYSE:CB) but similarly valued. These stocks are The Bank of Nova Scotia (NYSE:BNS), The Sherwin-Williams Company (NYSE:SHW), Capital One Financial Corp. (NYSE:COF), Fiserv, Inc. (NASDAQ:FISV), Equinix Inc (NASDAQ:EQIX), Becton, Dickinson and Company (NYSE:BDX), and Edwards Lifesciences Corporation (NYSE:EW). This group of stocks’ market caps are similar to CB’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BNS | 17 | 193321 | 3 |
| SHW | 44 | 1576816 | -5 |
| COF | 55 | 4708790 | -9 |
| FISV | 65 | 3945223 | -7 |
| EQIX | 31 | 1195457 | -2 |
| BDX | 51 | 2339968 | -1 |
| EW | 43 | 2169239 | -4 |
| Average | 43.7 | 2304116 | -3.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 43.7 hedge funds with bullish positions and the average amount invested in these stocks was $2304 million. That figure was $1273 million in CB’s case. Fiserv, Inc. (NASDAQ:FISV) is the most popular stock in this table. On the other hand The Bank of Nova Scotia (NYSE:BNS) is the least popular one with only 17 bullish hedge fund positions. Chubb Limited (NYSE:CB) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CB is 24.5. 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 29.6% in 2021 and still beat the market by 3.6 percentage points. A small number of hedge funds were also right about betting on CB as the stock returned 14.2% since the end of the third quarter (through 1/31) and outperformed the market by an even larger margin.
Follow Chubb Corp (Old Insider Filings) (NYSE:CB)
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Disclosure: None. This article was originally published at Insider Monkey.
