Hedge Funds Are Souring On Corning Incorporated (GLW)

The financial regulations require hedge funds and wealthy investors that exceeded the $100 million holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on September 30th. We at Insider Monkey have made an extensive database of more than 867 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Corning Incorporated (NYSE:GLW) based on those filings.

Corning Incorporated (NYSE:GLW) was in 40 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 42. GLW investors should pay attention to a decrease in support from the world’s most elite money managers lately. There were 42 hedge funds in our database with GLW holdings at the end of June. Our calculations also showed that GLW isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Now we’re going to take a look at the fresh hedge fund action surrounding Corning Incorporated (NYSE:GLW).

Donald Yacktman of Yacktman Asset Management

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

At Q3’s end, a total of 40 of the hedge funds tracked by Insider Monkey were long this stock, a change of -5% from the second quarter of 2021. By comparison, 36 hedge funds held shares or bullish call options in GLW a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).

Among these funds, Arrowstreet Capital held the most valuable stake in Corning Incorporated (NYSE:GLW), which was worth $111.7 million at the end of the third quarter. On the second spot was Renaissance Technologies which amassed $64.9 million worth of shares. Millennium Management, Yacktman Asset Management, and Adage Capital Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Valueworks LLC allocated the biggest weight to Corning Incorporated (NYSE:GLW), around 2.23% of its 13F portfolio. Beech Hill Partners is also relatively very bullish on the stock, designating 1.88 percent of its 13F equity portfolio to GLW.

Due to the fact that Corning Incorporated (NYSE:GLW) has witnessed falling interest from the entirety of the hedge funds we track, logic holds that there is a sect of funds that slashed their entire stakes by the end of the third quarter. At the top of the heap, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors sold off the biggest position of all the hedgies watched by Insider Monkey, comprising about $13.5 million in stock. Ray Dalio’s fund, Bridgewater Associates, also sold off its stock, about $9.4 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds by the end of the third quarter.

Let’s go over hedge fund activity in other stocks similar to Corning Incorporated (NYSE:GLW). We will take a look at Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX), Ferguson plc (NYSE:FERG), State Street Corporation (NYSE:STT), AvalonBay Communities Inc (NYSE:AVB), Corteva, Inc. (NYSE:CTVA), Seagen Inc. (NASDAQ:SGEN), and Equifax Inc. (NYSE:EFX). This group of stocks’ market caps resemble GLW’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
FMX 13 610447 0
FERG 10 6564548 -1
STT 42 1479764 5
AVB 28 376882 2
CTVA 41 1161923 7
SGEN 40 9471190 3
EFX 43 3360148 6
Average 31 3289272 3.1

View table here if you experience formatting issues.

As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $3289 million. That figure was $408 million in GLW’s case. Equifax Inc. (NYSE:EFX) is the most popular stock in this table. On the other hand Ferguson plc (NYSE:FERG) is the least popular one with only 10 bullish hedge fund positions. Corning Incorporated (NYSE:GLW) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GLW is 77. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately GLW wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on GLW were disappointed as the stock returned 2.3% since the end of September (through 11/30) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.

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