Was The Smart Money Right About Dun & Bradstreet Holdings, Inc. (NYSE:DNB)?

The latest 13F reporting period has come and gone, and Insider Monkey have plowed through 867 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 September 30th, when the S&P 500 Index was trading around the 4300 level. Since then investors decided to bet on the economic recovery and a stock market rebound even though we experienced a temporary correction in January. In this article you are going to find out whether hedge funds thought Dun & Bradstreet Holdings, Inc. (NYSE:DNB) was a good investment heading into the fourth quarter and how the stock traded in comparison to the top hedge fund picks.

Dun & Bradstreet Holdings, Inc. (NYSE:DNB) investors should pay attention to a decrease in hedge fund interest of late. Dun & Bradstreet Holdings, Inc. (NYSE:DNB) was in 33 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 45. There were 45 hedge funds in our database with DNB positions at the end of the second quarter. Our calculations also showed that DNB 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 take a gander at the latest hedge fund action surrounding Dun & Bradstreet Holdings, Inc. (NYSE:DNB).

Gavin Saitowitz of Prelude Capital

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

At third quarter’s end, a total of 33 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -27% from the previous quarter. By comparison, 27 hedge funds held shares or bullish call options in DNB a year ago. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were upping their holdings considerably (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Rivulet Capital, managed by Barry Lebovits and Joshua Kuntz, holds the biggest position in Dun & Bradstreet Holdings, Inc. (NYSE:DNB). Rivulet Capital has a $142.6 million position in the stock, comprising 7.4% of its 13F portfolio. The second most bullish fund manager is Ricky Sandler of Eminence Capital, with a $90.9 million position; 1.2% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors that hold long positions contain Will Cook’s Sunriver Management, Seth Rosen’s Nitorum Capital and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Sunriver Management allocated the biggest weight to Dun & Bradstreet Holdings, Inc. (NYSE:DNB), around 8.13% of its 13F portfolio. Rivulet Capital is also relatively very bullish on the stock, earmarking 7.44 percent of its 13F equity portfolio to DNB.

Judging by the fact that Dun & Bradstreet Holdings, Inc. (NYSE:DNB) has experienced falling interest from the aggregate hedge fund industry, it’s safe to say that there exists a select few money managers who sold off their entire stakes last quarter. Interestingly, Doug Silverman and Alexander Klabin’s Senator Investment Group dropped the largest stake of the 750 funds tracked by Insider Monkey, valued at about $53.4 million in stock. Tom Purcell and Marco Tablada’s fund, Alua Capital Management, also sold off its stock, about $45.2 million worth. These transactions are important to note, as total hedge fund interest was cut by 12 funds last quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Dun & Bradstreet Holdings, Inc. (NYSE:DNB) but similarly valued. These stocks are ShockWave Medical, Inc. (NASDAQ:SWAV), Wyndham Hotels & Resorts, Inc. (NYSE:WH), Gold Fields Limited (NYSE:GFI), Woodward Inc (NASDAQ:WWD), WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC), Pure Storage, Inc. (NYSE:PSTG), and Pinnacle Financial Partners, Inc. (NASDAQ:PNFP). This group of stocks’ market caps match DNB’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 27.9 hedge funds with bullish positions and the average amount invested in these stocks was $661 million. That figure was $627 million in DNB’s case. WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC) is the most popular stock in this table. On the other hand Gold Fields Limited (NYSE:GFI) is the least popular one with only 15 bullish hedge fund positions. Dun & Bradstreet Holdings, Inc. (NYSE:DNB) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for DNB is 37. 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. Hedge funds were also right about betting on DNB as the stock returned 19.3% since the end of Q3 (through 1/31) 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.