What Do Hedge Funds Think of Leggett & Platt, Inc. (LEG)?

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider Leggett & Platt, Inc. (NYSE:LEG) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.

Leggett & Platt, Inc. (NYSE:LEG) was in 23 hedge funds’ portfolios at the end of September. LEG has seen an increase in hedge fund sentiment in recent months. There were 12 hedge funds in our database with LEG holdings at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Brookfield Property Partners LP (NYSE:BPY), Zions Bancorporation (NASDAQ:ZION), and CoStar Group Inc (NASDAQ:CSGP) to gather more data points.

To the average investor there are tons of methods stock market investors use to grade publicly traded companies. Two of the less known methods are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the best picks of the elite fund managers can beat their index-focused peers by a significant amount (see the details here).

Now, let’s check out the latest action encompassing Leggett & Platt, Inc. (NYSE:LEG).

Hedge fund activity in Leggett & Platt, Inc. (NYSE:LEG)

At the end of the third quarter, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 92% from the second quarter. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Winton Capital Management, managed by David Harding, holds the largest position in Leggett & Platt, Inc. (NYSE:LEG). Winton Capital Management has a $33.9 million position in the stock, comprising 0.3% of its 13F portfolio. On Winton Capital Management’s heels is AQR Capital Management, led by Cliff Asness, holding a $26 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors that are bullish comprise Jim Simons’ Renaissance Technologies, Israel Englander’s Millennium Management and Phill Gross and Robert Atchinson’s Adage Capital Management.

As industrywide interest jumped, specific money managers have jumped into Leggett & Platt, Inc. (NYSE:LEG) headfirst. Winton Capital Management, managed by David Harding, established the most outsized position in Leggett & Platt, Inc. (NYSE:LEG). Winton Capital Management had $33.9 million invested in the company at the end of the quarter. Jim Simons’ Renaissance Technologies also initiated a $12.5 million position during the quarter. The other funds with new positions in the stock are Israel Englander’s Millennium Management, George Hall’s Clinton Group, and Gregg Moskowitz’s Interval Partners.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Leggett & Platt, Inc. (NYSE:LEG) but similarly valued. These stocks are Brookfield Property Partners LP (NYSE:BPY), Zions Bancorporation (NASDAQ:ZION), CoStar Group Inc (NASDAQ:CSGP), and Grupo Aeroportuario del Pacifico (ADR) (NYSE:PAC). This group of stocks’ market caps resemble LEG’s market cap.

As you can see these stocks had an average of 15.5 hedge funds with bullish positions and the average amount invested in these stocks was $185 million. That figure was $133 million in LEG’s case. Zions Bancorporation (NASDAQ:ZION) is the most popular stock in this table. On the other hand Grupo Aeroportuario del Pacifico (ADR) (NYSE:PAC) is the least popular one with only 5 bullish hedge fund positions. Leggett & Platt, Inc. (NYSE:LEG) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard ZION might be a better candidate to consider a long position.