Winton Capital Management Loves These Five Stocks

David Harding’s Winton Capital Management recently filed its latest Form 13F with the U.S. Securities and Exchange Commission for the reporting period of September 30. The filing showed that Winton Capital’s held over 350 long positions in its equity portfolio at the end of the second quarter, with an aggregate value of these investments was $12.64 billion at that time. During the third quarter, Winton Capital initiated positions in over 40 companies, while it reduced more than 100 holdings. Winton Capital, founded by David Harding in 1997, follows a strategy similar to that of Jim Simons’ Renaissance Technologies. It uses a detailed quantitative analysis to make investment decisions. In this article, we will be taking at Winton Capital’s top five holdings in terms of value.

Top investors spend considerable time and money conducting due diligence on each company they invest in, which makes them the perfect investors to emulate. However, we also know that the returns of hedge funds on the whole have not been good for several years, underperforming the market. We analyzed the historical stock picks of these investors and our research revealed that the small-cap picks of these funds performed far better than their large-cap picks, which is where most of their money is invested and why their performances as a whole have been poor. Why pay fees to invest in both the best and worst ideas of a particular hedge fund when you can simply mimic the best ideas of the best fund managers on your own? A portfolio consisting of the 15 most popular small-cap stock picks among the funds we track has returned 102% and beaten the market by more than 53 percentage points since the end of August 2012 (see more details).

#5 Archer Daniels Midland Company (NYSE:ADM)

Shares held (as of September 30): 3,193,707

Total Value (as of September 30): $132.38 million

Percent of Portfolio (as of September 30): 1.05%

Archer Daniels Midland Company (NYSE:ADM) is a provider of agricultural processors and food ingredient, with a market cap of $24.78 billion. Winton Capital increased its position in the company by 5% over the quarter. The financial position of Archer Daniels Midland Company (NYSE:ADM looks not very impressive, with its third-quarter earnings massively declining to $252 million, compared to $747 million for the same period last year. Revenue also declined to $16.6 billion from $18.1 billion. Archer Daniels Midland Company (NYSE:ADM)’s stock has lost 21.87% year-to-date. Cliff Asness’ AQR Capital Management held 7.77 million Archer Daniels Midland shares as of June 30.

#4 Allstate Corp (NYSE:ALL)

Shares held (as of September 30): 2,415,290

Total Value (as of September 30): $140.67 million

Percent of Portfolio (as of September 30): 1.11%

Winton Capital added more shares to its holding of Allstate Corp (NYSE:ALL), a $24.53-billion market company engaged in the property-liability insurance and life insurance business. The fund’s stake represents an over 40% increase quarter-over-quarter. For the third quarter, Allstate Corp (NYSE:ALL)’s income available to common shareholders decreased to $621 million, compared to $750 million a year ago. However, the company managed to increase its revenues to $9.03 billion in the third quarter, versus $8.94 billion in the same period of 2014. Shares of Allstate Corp (NYSE:ALL) have declined by 10.02% year-to-date. Another largest shareholder of Allstate, among those we track, is John A. Levin’s Levin Capital Strategies, with ownership of around 3 million shares.

On the next page, you will learn about Winton Capital’s top three stocks, including Best Buy Co Inc (NYSE:BBY).

#3 Travelers Companies Inc (NYSE:TRV)

Shares held (as of September 30): 1,490,015

Total Value (as of September 30): $148.30 million

Percent of Portfolio (as of September 30): 1.17%

Winton Capital is a fan of Travelers Companies Inc (NYSE:TRV), in which the investor increased its position by 14% over the quarter. With a market cap of $34.76-billion, Travelers Companies Inc (NYSE:TRV) is engaged in providing property casualty insurance for auto, home and business. The company posted improved financial results for the third quarter, with its income increasing to $928 million, or $2.97 per share, from $919 million, or $2.69 per share, a year earlier. The performance of the company’s stock is in green, increasing by 8% year-to-date. Travelers Companies Inc (NYSE:TRV) is also favorite stock of Jim Simons’ Renaissance Technologies, which held 687,672 shares as of the end of June.

#2 Best Buy Co Inc (NYSE:BBY)

Shares held (as of September 30): 4,148,645

Total Value (as of September 30): $154 million

Percent of Portfolio (as of September 30): 1.22%

Winton Capital was bullish on Best Buy Co Inc (NYSE:BBY), in which the fund increased its share ownership by over 62%. Best Buy Co Inc (NYSE:BBY), which provides technology products, services and solutions, reported better-than-expected results for its second quarter ended August 1. Its revenue rose to $8.53 billion, compared to $8.46 billion in the prior year’s quarter. Earnings per share from continuing operations was $0.46, compared to $0.39 last year. Another investor, Israel Englander’s Millennium Management, also sees value in Best Buy Co Inc (NYSE:BBY), holding 980,713 shares of the company.

#1 Corning Incorporated (NYSE:GLW)

Shares held (as of September 30): 9,467,490

Total Value (as of September 30): $162.08 million

Percent of Portfolio (as of September 30): 1.28%

Corning Incorporated (NYSE:GLW) represents Winton Capital’s top holding, in which the investor boosted its stake by over 85% between July and September. The $22.09-billion market cap company is engaged in the manufacture of specialty glass and ceramics. Last week, Corning Incorporated (NYSE:GLW) announced that it had completed the acquisition of Gerresheimer AG’s pharmaceutical glass tubing business. Corning agreed in June to acquire Gerresheimer’s pharmaceutical glass tubing business for €196 million. In addition, Corning Incorporated (NYSE:GLW) announced the formation of an equity venture with Gerresheimer to accelerate the company’s innovations in the pharmaceutical packaging market. For the third quarter, Corning posted earnings per share of $0.34, compared to $0.37 per share last year. Its sales dropped to $2.45 billion, compared to $2.58 billion in a year ago quarter. Shares of Corning Incorporated (NYSE:GLW)’s stock have been performing well, increasing by nearly 19% year-to-date. Another investor that likes Corning is Richard S. Pzena’s Pzena Investment Management, holding 4.79 million shares of the company as of the end of September.

Disclosure: none