Hedge Funds Have Never Been This Bullish On Expeditors International of Washington, Inc. (EXPD)

“Since 2006, value stocks (IVE vs IVW) have underperformed 11 of the 13 calendar years and when they beat growth, it wasn’t by much. Cumulatively, through this week, it has been a 122% differential (up 52% for value vs up 174% for growth). This appears to be the longest and most severe drought for value investors since data collection began. It will go our way eventually as there are too many people paying far too much for today’s darlings, both public and private. Further, the ten-year yield of 2.5% (pre-tax) isn’t attractive nor is real estate. We believe the value part of the global equity market is the only place to earn solid risk adjusted returns and we believe those returns will be higher than normal,” said Vilas Fund in its Q1 investor letter. We aren’t sure whether value stocks outperform growth, but we follow hedge fund investor letters to understand where the markets and stocks might be going. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Expeditors International of Washington, Inc. (NASDAQ:EXPD).

Expeditors International of Washington, Inc. (NASDAQ:EXPD) has seen an increase in enthusiasm from smart money lately. Our calculations also showed that expd isn’t among the 30 most popular stocks among hedge funds.

In the 21st century investor’s toolkit there are several tools market participants put to use to analyze their holdings. A pair of the best tools are hedge fund and insider trading indicators. Our experts have shown that, historically, those who follow the top picks of the elite money managers can outpace the broader indices by a very impressive amount (see the details here).

Noam Gottesman GLG Partners

Noam Gottesman, GLG Partners

We’re going to review the new hedge fund action regarding Expeditors International of Washington, Inc. (NASDAQ:EXPD).

What have hedge funds been doing with Expeditors International of Washington, Inc. (NASDAQ:EXPD)?

Heading into the second quarter of 2019, a total of 30 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25% from the fourth quarter of 2018. Below, you can check out the change in hedge fund sentiment towards EXPD over the last 15 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).

No of Hedge Funds with EXPD Positions

Among these funds, Select Equity Group held the most valuable stake in Expeditors International of Washington, Inc. (NASDAQ:EXPD), which was worth $201.9 million at the end of the first quarter. On the second spot was AQR Capital Management which amassed $63.6 million worth of shares. Moreover, Tensile Capital, GLG Partners, and Scopus Asset Management were also bullish on Expeditors International of Washington, Inc. (NASDAQ:EXPD), allocating a large percentage of their portfolios to this stock.

As aggregate interest increased, some big names were breaking ground themselves. Scopus Asset Management, managed by Alexander Mitchell, established the most valuable position in Expeditors International of Washington, Inc. (NASDAQ:EXPD). Scopus Asset Management had $26.6 million invested in the company at the end of the quarter. Peter Muller’s PDT Partners also initiated a $9.1 million position during the quarter. The following funds were also among the new EXPD investors: Paul Tudor Jones’s Tudor Investment Corp, Michael Gelband’s ExodusPoint Capital, and David Costen Haley’s HBK Investments.

Let’s also examine hedge fund activity in other stocks similar to Expeditors International of Washington, Inc. (NASDAQ:EXPD). These stocks are Apache Corporation (NYSE:APA), Arch Capital Group Ltd. (NASDAQ:ACGL), W.P. Carey Inc. (NYSE:WPC), and Extra Space Storage, Inc. (NYSE:EXR). This group of stocks’ market caps are similar to EXPD’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
APA 28 616390 -1
ACGL 12 1100250 -1
WPC 13 55062 3
EXR 17 162191 -7
Average 17.5 483473 -1.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 17.5 hedge funds with bullish positions and the average amount invested in these stocks was $483 million. That figure was $512 million in EXPD’s case. Apache Corporation (NYSE:APA) is the most popular stock in this table. On the other hand Arch Capital Group Ltd. (NASDAQ:ACGL) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Expeditors International of Washington, Inc. (NASDAQ:EXPD) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately EXPD wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on EXPD were disappointed as the stock returned -7.4% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market in Q2.

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