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 Brunswick Corporation (NYSE:BC) was a good investment heading into the fourth quarter and how the stock traded in comparison to the top hedge fund picks.
Brunswick Corporation (NYSE:BC) investors should be aware of an increase in hedge fund interest in recent months. Brunswick Corporation (NYSE:BC) was in 39 hedge funds’ portfolios at the end of September. The all time high for this statistic is 42. Our calculations also showed that BC 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 we’re going to take a look at the latest hedge fund action encompassing Brunswick Corporation (NYSE:BC).
William Von Mueffling of Cantillon Capital Management
Do Hedge Funds Think BC Is A Good Stock To Buy Now?
At Q3’s end, a total of 39 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from the second quarter of 2021. On the other hand, there were a total of 34 hedge funds with a bullish position in BC a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Cantillon Capital Management held the most valuable stake in Brunswick Corporation (NYSE:BC), which was worth $390.5 million at the end of the third quarter. On the second spot was Arrowstreet Capital which amassed $154.5 million worth of shares. Kensico Capital, Shellback Capital, and Lakewood Capital 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 Shellback Capital allocated the biggest weight to Brunswick Corporation (NYSE:BC), around 3.84% of its 13F portfolio. Kensico Capital is also relatively very bullish on the stock, designating 3.64 percent of its 13F equity portfolio to BC.
As aggregate interest increased, some big names have been driving this bullishness. Balyasny Asset Management, managed by Dmitry Balyasny, assembled the biggest position in Brunswick Corporation (NYSE:BC). Balyasny Asset Management had $11.3 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also initiated a $1.8 million position during the quarter. The other funds with brand new BC positions are David Harding’s Winton Capital Management, Peter Algert’s Algert Global, and John A. Levin’s Levin Capital Strategies.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Brunswick Corporation (NYSE:BC) but similarly valued. These stocks are First American Financial Corp (NYSE:FAF), Capri Holdings Limited (NYSE:CPRI), IAA, Inc. (NYSE:IAA), Alaska Air Group, Inc. (NYSE:ALK), PVH Corp (NYSE:PVH), Pearson PLC (NYSE:PSO), and Chemed Corporation (NYSE:CHE). This group of stocks’ market values match BC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| FAF | 29 | 1505467 | -2 |
| CPRI | 46 | 833450 | 2 |
| IAA | 33 | 714704 | 0 |
| ALK | 41 | 647583 | 3 |
| PVH | 38 | 2157407 | 10 |
| PSO | 8 | 15064 | 1 |
| CHE | 20 | 272040 | -10 |
| Average | 30.7 | 877959 | 0.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 30.7 hedge funds with bullish positions and the average amount invested in these stocks was $878 million. That figure was $1090 million in BC’s case. Capri Holdings Limited (NYSE:CPRI) is the most popular stock in this table. On the other hand Pearson PLC (NYSE:PSO) is the least popular one with only 8 bullish hedge fund positions. Brunswick Corporation (NYSE:BC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for BC is 74.6. 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. 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 29.6% in 2021 and beat the market again by 3.6 percentage points. Unfortunately, BC wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on BC were disappointed as the stock returned -4.4% since the end of September (through 1/31) 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 all of these stocks already outperformed the market since 2019.
Follow Brunswick Corp (NYSE:BC)
Follow Brunswick Corp (NYSE:BC)
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Disclosure: None. This article was originally published at Insider Monkey.
