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 Prudential Financial Inc (NYSE:PRU) was a good investment heading into the fourth quarter and how the stock traded in comparison to the top hedge fund picks.
Prudential Financial Inc (NYSE:PRU) was in 33 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 39. PRU has seen an increase in hedge fund sentiment recently. There were 28 hedge funds in our database with PRU positions at the end of the second quarter. Our calculations also showed that PRU 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. Now let’s take a gander at the key hedge fund action surrounding Prudential Financial Inc (NYSE:PRU).
Blair Levinsky of Waratah Capital Advisors
Do Hedge Funds Think PRU Is A Good Stock To Buy Now?
At third quarter’s end, a total of 33 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 18% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in PRU over the last 25 quarters. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
More specifically, Arrowstreet Capital was the largest shareholder of Prudential Financial Inc (NYSE:PRU), with a stake worth $164.1 million reported as of the end of September. Trailing Arrowstreet Capital was Citadel Investment Group, which amassed a stake valued at $51.7 million. AQR Capital Management, Adage Capital Management, and Mountain Road Advisors 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 Mountain Road Advisors allocated the biggest weight to Prudential Financial Inc (NYSE:PRU), around 9.37% of its 13F portfolio. Capital Growth Management is also relatively very bullish on the stock, designating 3.23 percent of its 13F equity portfolio to PRU.
Consequently, key money managers were leading the bulls’ herd. Schonfeld Strategic Advisors, managed by Ryan Tolkin (CIO), initiated the largest position in Prudential Financial Inc (NYSE:PRU). Schonfeld Strategic Advisors had $28.2 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also initiated a $13.8 million position during the quarter. The other funds with new positions in the stock are Jinghua Yan’s TwinBeech Capital, Brad Dunkley and Blair Levinsky’s Waratah Capital Advisors, and Renee Yao’s Neo Ivy Capital.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Prudential Financial Inc (NYSE:PRU) but similarly valued. We will take a look at Koninklijke Philips NV (NYSE:PHG), Paychex, Inc. (NASDAQ:PAYX), Electronic Arts Inc. (NASDAQ:EA), Constellation Brands, Inc. (NYSE:STZ), Sempra (NYSE:SRE), Aptiv PLC (NYSE:APTV), and Baxter International Inc. (NYSE:BAX). This group of stocks’ market values resemble PRU’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PHG | 11 | 79466 | 1 |
| PAYX | 34 | 1115089 | 5 |
| EA | 53 | 1097032 | -3 |
| STZ | 53 | 1719109 | 3 |
| SRE | 23 | 287269 | -5 |
| APTV | 44 | 1757047 | 4 |
| BAX | 42 | 3485785 | -4 |
| Average | 37.1 | 1362971 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 37.1 hedge funds with bullish positions and the average amount invested in these stocks was $1363 million. That figure was $460 million in PRU’s case. Electronic Arts Inc. (NASDAQ:EA) is the most popular stock in this table. On the other hand Koninklijke Philips NV (NYSE:PHG) is the least popular one with only 11 bullish hedge fund positions. Prudential Financial Inc (NYSE:PRU) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for PRU is 61.6. 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 PRU as the stock returned 7.2% since the end of the third quarter (through 1/31) and outperformed the market by an even larger margin.
Follow Prudential Financial Inc (NYSE:PRU)
Follow Prudential Financial Inc (NYSE:PRU)
Suggested Articles:
- Top 15 Emerging Companies In India
- 15 Largest Industrial Companies In The US
- 25 Best US Cities To Live with Asthma
Disclosure: None. This article was originally published at Insider Monkey.
