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 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% during the last 12 months ending in October 30. Sixty three percent of these 30 stocks outperformed the market. Although the elite funds occasionally have their duds, such as Micron and Anadarko Petroleum, which fell 50% and 26%, respectively during the same time period, 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 PepsiCo, Inc. (NYSE:PEP).
PepsiCo, Inc. (NYSE:PEP) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 57 hedge funds’ portfolios at the end of September. At the end of this article, we will also compare PepsiCo, Inc. (NYSE:PEP) to other stocks, including Cisco Systems, Inc. (NASDAQ:CSCO), PetroChina Company Limited (ADR) (NYSE:PTR), and Reynolds American, Inc. (NYSE:RAI) to get a better sense of its popularity.
If you’d ask most shareholders, hedge funds are viewed as unimportant, outdated investment tools of yesteryear. While there are over 8000 funds in operation at the moment, Our experts choose to focus on the upper echelon of this club, around 700 funds. Most estimates calculate that this group of people controls most of the hedge fund industry’s total asset base, and by watching their top investments, Insider Monkey has brought to light numerous investment strategies that have historically surpassed the market. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 12 percentage points a year for a decade in their back tests.
Keeping this in mind, let’s check out the key action regarding PepsiCo, Inc. (NYSE:PEP).
What does the smart money think about PepsiCo, Inc. (NYSE:PEP)?
Heading into Q4, a total of 57 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from the second quarter. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Trian Partners, managed by Nelson Peltz, holds the number one position in PepsiCo, Inc. (NYSE:PEP). Trian Partners has a $1.72 billion position in the stock, comprising 14.7% of its 13F portfolio. Sitting at the No. 2 spot is Donald Yacktman of Yacktman Asset Management, with an $1.68 billion position; the fund has 11% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions encompass Boykin Curry’s Eagle Capital Management, Ken Fisher’s Fisher Asset Management, and Phill Gross and Robert Atchinson’s Adage Capital Management.