Consumer durable goods are defined as the products that yield utility over time and do not wear out quickly. According to the latest Commerce Department report, orders for durable goods surged by 4.4% in July, rebounding from a 4.2% decline in June. Analysts think that Consumer Durables sector will gain from lower GST rates and savings in logistics and transportation costs in the coming months. In this article, we are going to take a look at five most popular consumer durable stocks among the smart money investors from our database.
We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see more details here).
Mohawk Industries, Inc. (NYSE:MHK)
– Number of Hedge Fund Shareholders (as of June 30): 47
– Total Value of Hedge Funds’ Holdings (as of June 30): $2.75 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 19.60%
A total of 47 hedge funds tracked by us were long Mohawk Industries, Inc. (NYSE:MHK) at the end of the second quarter, versus 49 hedge funds a quarter earlier. The stock has gained over 10% year-to-date. Mohawk Industries registered record profit and sales in the first quarter, after which it planned $600 million of capital investments for the year. The company reported second-quarter EPS of $3.47 on $2.31 billion in revenue, versus analysts’ estimates of EPS of $3.37 on revenue of $2.35 billion. For the third quarter, Mohawk Industries, Inc. (NYSE:MHK) expects EPS between $3.40 and $3.49 EPS, versus the consensus estimate of $3.37. Dan Loeb’s Third Point owns 1.5 million shares of Mohawk, as of the end of the second quarter.
Ball Corporation (NYSE:BLL)
– Number of Hedge Fund Shareholders (as of June 30): 42
– Total Value of Hedge Funds’ Holdings (as of June 30): $2.11 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 20.60%
Ball Corporation (NYSE:BLL) shares have gained over 8% since the start of the year. The Colorado-based packaging and aerospace company posted a mixed second quarter, but provided an upbeat guidance. The company earned $1.05 per share, up by 18% year-over-year, and above the Street’s estimates of $0.99, but revenue of $2.03 billion was lower than the consensus estimate of $2.15 billion. At the end of June, Ball Corporation (NYSE:BLL) completed its $6.1 billion acquisition of British packaging company Rexam. Richard Perry’s Perry Capital owns over 2.69 million shares of Ball Corporation, as of the end of the June quarter.
On the next page, we will continue our discussion on hedge funds’ moves surrounding consumer durable stocks.