Hedge Funds Are Cashing Out Of Service Corporation International (SCI)

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the first quarter, which unveil their equity positions as of March 31st. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Service Corporation International (NYSE:SCI).

Service Corporation International (NYSE:SCI) investors should pay attention to a decrease in enthusiasm from smart money lately. Service Corporation International (NYSE:SCI) was in 23 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 37. Our calculations also showed that SCI isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

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Do Hedge Funds Think SCI Is A Good Stock To Buy Now?

At Q1’s end, a total of 23 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -18% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards SCI over the last 23 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Service Corporation International (NYSE:SCI) was held by Select Equity Group, which reported holding $581.2 million worth of stock at the end of December. It was followed by Two Sigma Advisors with a $34.1 million position. Other investors bullish on the company included Arrowstreet Capital, D E Shaw, and Renaissance Technologies. In terms of the portfolio weights assigned to each position Select Equity Group allocated the biggest weight to Service Corporation International (NYSE:SCI), around 2.11% of its 13F portfolio. PDT Partners is also relatively very bullish on the stock, dishing out 0.36 percent of its 13F equity portfolio to SCI.

Seeing as Service Corporation International (NYSE:SCI) has faced declining sentiment from hedge fund managers, logic holds that there exists a select few fund managers who were dropping their positions entirely in the first quarter. Interestingly, Paul Marshall and Ian Wace’s Marshall Wace LLP said goodbye to the biggest investment of the 750 funds monitored by Insider Monkey, comprising about $6.9 million in stock, and Mark Coe’s Intrinsic Edge Capital was right behind this move, as the fund dropped about $2.9 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest fell by 5 funds in the first quarter.

Let’s now review hedge fund activity in other stocks similar to Service Corporation International (NYSE:SCI). We will take a look at GSX Techedu Inc. (NYSE:GSX), Alaska Air Group, Inc. (NYSE:ALK), Assurant, Inc. (NYSE:AIZ), Reinsurance Group of America Inc (NYSE:RGA), UGI Corp (NYSE:UGI), Vistra Corp. (NYSE:VST), and Guidewire Software Inc (NYSE:GWRE). All of these stocks’ market caps are similar to SCI’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
GSX 30 277849 13
ALK 32 587935 -3
AIZ 27 1029086 0
RGA 27 355245 8
UGI 19 189152 -6
VST 46 1254154 7
GWRE 33 1534269 -2
Average 30.6 746813 2.4

View table here if you experience formatting issues.

As you can see these stocks had an average of 30.6 hedge funds with bullish positions and the average amount invested in these stocks was $747 million. That figure was $710 million in SCI’s case. Vistra Corp. (NYSE:VST) is the most popular stock in this table. On the other hand UGI Corp (NYSE:UGI) is the least popular one with only 19 bullish hedge fund positions. Service Corporation International (NYSE:SCI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for SCI is 26.1. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 23.8% in 2021 through July 16th and beat the market by 7.7 percentage points. A small number of hedge funds were also right about betting on SCI, though not to the same extent, as the stock returned 10% since the end of Q1 (through July 16th) and outperformed the market.

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Disclosure: None. This article was originally published at Insider Monkey.