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Are Hedge Funds Right To Be Bullish On The Bank of New York Mellon Corporation (BK)?

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Before we spend many hours researching a company, we’d like to analyze what hedge funds and billionaire investors think of the stock first. We would like to do so because the elite investors’ consensus returns have been exceptional. The top 30 mid-cap stocks among the best performing hedge funds in our database yielded an average return of 18% during the last 12 months, outperforming the S&P 500 Index funds by double digits. Although the elite funds occasionally have their duds, such as SunEdison and Valeant, the hedge fund picks seem to work on average. In the following paragraphs, we find out what the billionaire investors and hedge funds think of The Bank of New York Mellon Corporation (NYSE:BK).

The Bank of New York Mellon Corporation (NYSE:BK) was included in the 13F portfolios of 47 funds from our database at the end of the third quarter of 2016. The company saw an increase in hedge fund sentiment, since there had been 41 funds bullish on the stock a quarter earlier. However, 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 Kinder Morgan Inc (NYSE:KMI), Phillips 66 (NYSE:PSX), and Target Corporation (NYSE:TGT) to gather more data points.

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At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

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How have hedgies been trading The Bank of New York Mellon Corporation (NYSE:BK)?

As mentioned earlier, a total of 47 investors tracked by Insider Monkey were bullish on The Bank of New York Mellon, up by 15% over the quarter, though still below the total of 52 hedgies that owned BK shares on March 31. With hedge funds’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
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According to Insider Monkey’s hedge fund database, Nelson Peltz’s Trian Partners has the biggest position in The Bank of New York Mellon Corporation (NYSE:BK), worth close to $1.29 billion, accounting for 12.6% of its total 13F portfolio. Coming in second is Berkshire Hathaway, managed by Warren Buffett, which holds a $842.9 million position. Some other professional money managers that hold long positions encompass Mario Gabelli’s GAMCO Investors, Donald Yacktman’s Yacktman Asset Management, and D E Shaw, founded by David E. Shaw.

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