Where Do Hedge Funds Stand On Nordstrom, Inc. (JWN)?

After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of March 31st. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Nordstrom, Inc. (NYSE:JWN).

Hedge fund interest in Nordstrom, Inc. (NYSE:JWN) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that JWN isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). 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 Virtu Financial Inc (NASDAQ:VIRT), Halozyme Therapeutics, Inc. (NASDAQ:HALO), and Choice Hotels International, Inc. (NYSE:CHH) to gather more data points.

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Matthew Hulsizer of PEAK6 Capital

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

At the end of the first quarter, a total of 34 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the previous quarter. The graph below displays the number of hedge funds with bullish position in JWN over the last 23 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

When looking at the institutional investors followed by Insider Monkey, Tremblant Capital, managed by Brett Barakett, holds the most valuable position in Nordstrom, Inc. (NYSE:JWN). Tremblant Capital has a $88.9 million position in the stock, comprising 2.6% of its 13F portfolio. The second largest stake is held by Citadel Investment Group, managed by Ken Griffin, which holds a $67 million call position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions encompass Ken Griffin’s Citadel Investment Group, Israel Englander’s Millennium Management and Matthew Hulsizer’s PEAK6 Capital Management. In terms of the portfolio weights assigned to each position Empirical Capital Partners allocated the biggest weight to Nordstrom, Inc. (NYSE:JWN), around 9.16% of its 13F portfolio. Pacifica Capital Investments is also relatively very bullish on the stock, earmarking 4.32 percent of its 13F equity portfolio to JWN.

Seeing as Nordstrom, Inc. (NYSE:JWN) has experienced declining sentiment from the entirety of the hedge funds we track, it’s easy to see that there is a sect of funds that elected to cut their entire stakes in the first quarter. Interestingly, Jack Woodruff’s Candlestick Capital Management sold off the biggest position of the “upper crust” of funds followed by Insider Monkey, valued at about $43.7 million in stock. Ryan Tolkin (CIO)’s fund, Schonfeld Strategic Advisors, also said goodbye to its stock, about $27 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now take a look at hedge fund activity in other stocks similar to Nordstrom, Inc. (NYSE:JWN). These stocks are Virtu Financial Inc (NASDAQ:VIRT), Halozyme Therapeutics, Inc. (NASDAQ:HALO), Choice Hotels International, Inc. (NYSE:CHH), American Campus Communities, Inc. (NYSE:ACC), Acuity Brands, Inc. (NYSE:AYI), Popular Inc (NASDAQ:BPOP), and SYNNEX Corporation (NYSE:SNX). This group of stocks’ market caps resemble JWN’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 24 hedge funds with bullish positions and the average amount invested in these stocks was $475 million. That figure was $293 million in JWN’s case. Popular Inc (NASDAQ:BPOP) is the most popular stock in this table. On the other hand SYNNEX Corporation (NYSE:SNX) is the least popular one with only 15 bullish hedge fund positions. Nordstrom, Inc. (NYSE:JWN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for JWN is 81.8. 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 19.3% in 2021 through June 25th and beat the market again by 4.8 percentage points. Unfortunately JWN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on JWN were disappointed as the stock returned -3.8% since the end of March (through 6/25) 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.

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

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