Despite Currency Headwinds Philip Morris International Inc. (PM) Posts Earnings Surprise

What does the smart money think about Philip Morris International Inc. (NYSE:PM)?

At the end of the first quarter, a total of 42 of the hedge funds tracked by Insider Monkey were long in this stock, a decrease from 44 funds at the end of the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings substantially.

Of the funds tracked by Insider Monkey, Andy Brown‘s Cedar Rock Capital had the most valuable position in Philip Morris International Inc. (NYSE:PM), worth close to $905.7 million, and accounting for a bullish 24.2% of its total 13F portfolio. Sitting at the number two spot is Tom Russo of Gardner Russo & Gardner, with a $760.4 million position; the fund has 6.8% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions include Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital, Phill Gross and Robert Atchinson’s Adage Capital Management, and Jim Simons‘ Renaissance Technologies.

Due to the fact that Philip Morris International Inc. (NYSE:PM) has experienced a decline in hedge fund ownership, it’s safe to say that there is a sect of funds who were dropping their positions entirely heading into the June quarter. Intriguingly, Matthew Tewksbury’s Stevens Capital Management dropped the biggest investment of the “upper crust” of funds tracked by Insider Monkey, worth an estimated $32.3 million in stock, while Brian Ashford-Russell and Tim Woolley of Polar Capital were right behind this move, as they dumped about $20.7 million worth of shares. These moves are important to note, as aggregate hedge fund interest fell by two funds heading into the second trimester.

Despite an earnings beat, we don’t see significant upside potential in the stock. While hedge funds were bullish in the first quarter, we think what they’ve been rewarded with thus far has been ample, and anticipate bullish behavior from them in the second quarter. We would advise investors to look for more profitable opportunities in other companies.

Disclosure: None