Were Hedge Funds Right About Piling Into Corning Incorporated (GLW)?

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of June 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Corning Incorporated (NYSE:GLW).

Is Corning Incorporated (NYSE:GLW) an exceptional investment today? Money managers were in a bullish mood. The number of bullish hedge fund positions advanced by 10 recently. Corning Incorporated (NYSE:GLW) was in 42 hedge funds’ portfolios at the end of June. The all time high for this statistic was previously 41. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that GLW isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.

Alex Litowitz of Magnetar Capital

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 are checking out stock pitches like this emerging lithium stock. 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. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now let’s take a gander at the key hedge fund action surrounding Corning Incorporated (NYSE:GLW).

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

At second quarter’s end, a total of 42 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 31% from the first quarter of 2020. On the other hand, there were a total of 28 hedge funds with a bullish position in GLW a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Corning Incorporated (NYSE:GLW) was held by Arrowstreet Capital, which reported holding $209.1 million worth of stock at the end of June. It was followed by GLG Partners with a $55.1 million position. Other investors bullish on the company included Yacktman Asset Management, Millennium Management, and Adage Capital Management. In terms of the portfolio weights assigned to each position Breakline Capital allocated the biggest weight to Corning Incorporated (NYSE:GLW), around 4.01% of its 13F portfolio. Valueworks LLC is also relatively very bullish on the stock, setting aside 2.53 percent of its 13F equity portfolio to GLW.

Consequently, key money managers have been driving this bullishness. Bridgewater Associates, managed by Ray Dalio, initiated the most outsized position in Corning Incorporated (NYSE:GLW). Bridgewater Associates had $9.4 million invested in the company at the end of the quarter. Renaissance Technologies also initiated a $8.5 million position during the quarter. The following funds were also among the new GLW investors: Michael Gelband’s ExodusPoint Capital, Mika Toikka’s AlphaCrest Capital Management, and Alec Litowitz and Ross Laser’s Magnetar Capital.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Corning Incorporated (NYSE:GLW) but similarly valued. These stocks are Welltower Inc. (NYSE:WELL), Nutrien Ltd. (NYSE:NTR), KKR & Co Inc. (NYSE:KKR), LyondellBasell Industries NV (NYSE:LYB), Yum! Brands, Inc. (NYSE:YUM), Archer Daniels Midland Company (NYSE:ADM), and Hilton Worldwide Holdings Inc (NYSE:HLT). This group of stocks’ market valuations are similar to GLW’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 37.6 hedge funds with bullish positions and the average amount invested in these stocks was $1901 million. That figure was $522 million in GLW’s case. KKR & Co Inc. (NYSE:KKR) is the most popular stock in this table. On the other hand Welltower Inc. (NYSE:WELL) is the least popular one with only 19 bullish hedge fund positions. Corning Incorporated (NYSE:GLW) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GLW is 72.9. 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 through November 5th and beat the market again by 3.1 percentage points. Unfortunately GLW wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on GLW were disappointed as the stock returned -5.7% since the end of June (through 11/5) 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.

Suggested Articles:

• Top 10 Value Stocks to Invest In According to ValueAct Capital
• 10 Best UK Stocks to Buy Now
• Billionaire Izzy Englander’s Top 10 Stock Picks

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