Hedge funds and other investment firms that we track manage billions of dollars of their wealthy clients’ money, and needless to say, they are painstakingly thorough when analyzing where to invest this money, as their own wealth depends on it. Regardless of the various methods used by elite investors like David Tepper and Dan Loeb, the resources they expend are second-to-none. This is especially valuable when it comes to small-cap stocks, which is where they generate their strongest outperformance, as their resources give them a huge edge when it comes to studying these stocks compared to the average investor, which is why we intently follow their activity in the small-cap space.
Jacobs Engineering Group Inc (NYSE:JEC) investors should pay attention to an increase in activity from the world’s largest hedge funds lately. JEC was in 26 hedge funds’ portfolios at the end of September. There were 16 hedge funds in our database with JEC holdings at the end of the previous quarter. At the end of this article we will also compare JEC to other stocks including Aluminum Corp. of China Limited (ADR) (NYSE:ACH), CubeSmart (NYSE:CUBE), and TransUnion (NYSE:TRU) to get a better sense of its popularity.
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With all of this in mind, let’s take a look at the recent action encompassing Jacobs Engineering Group Inc (NYSE:JEC).
What does the smart money think about Jacobs Engineering Group Inc (NYSE:JEC)?
At the end of the third quarter, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 63% from the second quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Joel Greenblatt’s Gotham Asset Management has the most valuable position in Jacobs Engineering Group Inc (NYSE:JEC), worth close to $35.1 million, comprising 0.3% of its total 13F portfolio. The second most bullish fund manager is David Harding of Winton Capital Management, with an $27.9 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Other hedge funds and institutional investors that are bullish comprise Israel Englander’s Millennium Management, John Overdeck and David Siegel’s Two Sigma Advisors and Neil Chriss’s Hutchin Hill Capital.
As one would reasonably expect, some big names were leading the bulls’ herd. Winton Capital Management, managed by David Harding, initiated the biggest position in Jacobs Engineering Group Inc (NYSE:JEC). Winton Capital Management had $27.9 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made an $22.9 million investment in the stock during the quarter. The following funds were also among the new JEC investors: Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Peter Muller’s PDT Partners, and Steve Cohen’s Point72 Asset Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Jacobs Engineering Group Inc (NYSE:JEC) but similarly valued. We will take a look at Aluminum Corp. of China Limited (ADR) (NYSE:ACH), CubeSmart (NYSE:CUBE), TransUnion (NYSE:TRU), and TIM Participacoes SA (ADR) (NYSE:TSU). This group of stocks’ market valuations are similar to JEC’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ACH | 5 | 3478 | -1 |
| CUBE | 14 | 260978 | 3 |
| TRU | 19 | 222735 | -10 |
| TSU | 13 | 273199 | -12 |
As you can see these stocks had an average of 12.75 hedge funds with bullish positions and the average amount invested in these stocks was $190 million. That figure was $179 million in JEC’s case. TransUnion (NYSE:TRU) is the most popular stock in this table. On the other hand Aluminum Corp. of China Limited (ADR) (NYSE:ACH) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Jacobs Engineering Group Inc (NYSE:JEC) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
