Although the masses and most of the financial media blame hedge funds for their exorbitant fee structure and disappointing performance, these investors have proved to have great stock picking abilities over the years (that’s why their assets under management continue to swell). We believe hedge fund sentiment should serve as a crucial tool of an individual investor’s stock selection process, as it may offer great insights of how the brightest minds of the finance industry feel about specific stocks. After all, these people have access to smartest analysts and expensive data/information sources that individual investors can’t match. So should one consider investing in World Fuel Services Corporation (NYSE:INT)? The smart money sentiment can provide an answer to this question.
World Fuel Services Corporation (NYSE:INT) was in 22 hedge funds’ portfolios at the end of September. INT investors should be aware of an increase in hedge fund interest lately. There were 21 hedge funds in our database with INT holdings at the end of the previous quarter. At the end of this article we will also compare INT to other stocks including Myriad Genetics, Inc. (NASDAQ:MYGN), TCF Financial Corporation (NYSE:TCB), and New Jersey Resources Corp (NYSE:NJR) to get a better sense of its popularity.
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Keeping this in mind, let’s take a peek at the new action encompassing World Fuel Services Corporation (NYSE:INT).
What have hedge funds been doing with World Fuel Services Corporation (NYSE:INT)?
Heading into Q4, a total of 22 of the hedge funds tracked by Insider Monkey were long this stock, a change of 5% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Amy Minella’s Cardinal Capital has the biggest position in World Fuel Services Corporation (NYSE:INT), worth close to $40.3 million, amounting to 2.5% of its total 13F portfolio. The second most bullish fund manager is Cliff Asness of AQR Capital Management, with a $8.9 million position; less than 0.1% of its 13F portfolio is allocated to the company. Remaining members of the smart money with similar optimism comprise Jim Simons’ Renaissance Technologies, Lee Munder’s Lee Munder Capital Group and Martin Whitman’s Third Avenue Management.
As one would reasonably expect, key money managers have been driving this bullishness. Lee Munder Capital Group, managed by Lee Munder, assembled the most outsized position in World Fuel Services Corporation (NYSE:INT). Lee Munder Capital Group had $8.3 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also initiated a $0.7 million position during the quarter. The following funds were also among the new INT investors: Roger Ibbotson’s Zebra Capital Management, Matthew Hulsizer’s PEAK6 Capital Management, and David Dreman’s Dreman Value Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as World Fuel Services Corporation (NYSE:INT) but similarly valued. We will take a look at Myriad Genetics, Inc. (NASDAQ:MYGN), TCF Financial Corporation (NYSE:TCB), New Jersey Resources Corp (NYSE:NJR), and TAL Education Group (ADR) (NYSE:XRS). All of these stocks’ market caps are similar to INT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MYGN | 21 | 734215 | 1 |
| TCB | 21 | 213017 | 4 |
| NJR | 14 | 41375 | -3 |
| XRS | 13 | 136108 | -4 |
As you can see these stocks had an average of 17.25 hedge funds with bullish positions and the average amount invested in these stocks was $281 million. That figure was $97 million in INT’s case. Myriad Genetics, Inc. (NASDAQ:MYGN) is the most popular stock in this table. On the other hand TAL Education Group (ADR) (NYSE:XRS) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks World Fuel Services Corporation (NYSE:INT) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
