Is Eaton Vance Corp (NYSE:EV) a good bet right now? We like to analyze hedge fund sentiment before doing days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy league graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments (for some reason media paid a ton of attention to Ackman’s gigantic JC Penney and Valeant failures) and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
Eaton Vance Corp (NYSE:EV) has experienced a decrease in enthusiasm from smart money of late. At the end of this article we will also compare EV to other stocks including West Pharmaceutical Services Inc. (NYSE:WST), STERIS Corp (NYSE:STE), and ON Semiconductor Corp (NASDAQ:ON) to get a better sense of its popularity.
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With all of this in mind, let’s take a glance at the new action regarding Eaton Vance Corp (NYSE:EV).
What have hedge funds been doing with Eaton Vance Corp (NYSE:EV)?
At the end of the third quarter, a total of 13 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -7% from one quarter earlier. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Ken Griffin’s Citadel Investment Group has the most valuable position in Eaton Vance Corp (NYSE:EV), worth close to $58.7 million, amounting to 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Gotham Asset Management, led by Joel Greenblatt, holding an $10 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining peers that are bullish contain Cliff Asness’s AQR Capital Management, Michael Platt and William Reeves’s BlueCrest Capital Mgmt. and John A. Levin’s Levin Capital Strategies.
Seeing as Eaton Vance Corp (NYSE:EV) has experienced declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there was a specific group of hedge funds that elected to cut their full holdings by the end of the third quarter. Interestingly, Neil Chriss’s Hutchin Hill Capital cut the largest investment of all the hedgies followed by Insider Monkey, valued at about $2.8 million in stock. Peter Muller’s fund, PDT Partners, also said goodbye to its stock, about $1.7 million worth.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Eaton Vance Corp (NYSE:EV) but similarly valued. These stocks are West Pharmaceutical Services Inc. (NYSE:WST), STERIS Corp (NYSE:STE), ON Semiconductor Corp (NASDAQ:ON), and USG Corporation (NYSE:USG). All of these stocks’ market caps are similar to EV’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WST | 10 | 139679 | 5 |
| STE | 23 | 351939 | -1 |
| ON | 29 | 563525 | -11 |
| USG | 28 | 1221249 | -1 |
As you can see these stocks had an average of 22.5 hedge funds with bullish positions and the average amount invested in these stocks was $569 million. That figure was $86 million in EV’s case. ON Semiconductor Corp (NASDAQ:ON) is the most popular stock in this table. On the other hand West Pharmaceutical Services Inc. (NYSE:WST) is the least popular one with only 10 bullish hedge fund positions. Eaton Vance Corp (NYSE:EV) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard ON might be a better candidate to consider a long position.
