The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards American International Group Inc (NYSE:AIG).
American International Group Inc (NYSE:AIG) has seen a decrease in enthusiasm from smart money of late. American International Group Inc (NYSE:AIG) was in 30 hedge funds’ portfolios at the end of September. The all time high for this statistic is 101. There were 39 hedge funds in our database with AIG holdings at the end of June. Our calculations also showed that AIG 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. With all of this in mind we’re going to analyze the new hedge fund action regarding American International Group Inc (NYSE:AIG).
David Harding of Winton Capital Management
Do Hedge Funds Think AIG Is A Good Stock To Buy Now?
At third quarter’s end, a total of 30 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -23% from the previous quarter. By comparison, 38 hedge funds held shares or bullish call options in AIG a year ago. With hedge funds’ sentiment swirling, there exists a few key hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Pzena Investment Management, managed by Richard S. Pzena, holds the biggest position in American International Group Inc (NYSE:AIG). Pzena Investment Management has a $923.7 million position in the stock, comprising 3.7% of its 13F portfolio. The second most bullish fund manager is Robert Rodriguez and Steven Romick of First Pacific Advisors LLC, with a $455.3 million position; 5.9% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors that are bullish consist of Benjamin A. Smith’s Laurion Capital Management, Dmitry Balyasny’s Balyasny Asset Management and Jeremy Hosking’s Hosking Partners. In terms of the portfolio weights assigned to each position First Pacific Advisors LLC allocated the biggest weight to American International Group Inc (NYSE:AIG), around 5.91% of its 13F portfolio. Pzena Investment Management is also relatively very bullish on the stock, designating 3.66 percent of its 13F equity portfolio to AIG.
Since American International Group Inc (NYSE:AIG) has faced falling interest from the entirety of the hedge funds we track, it’s safe to say that there were a few hedge funds that elected to cut their full holdings by the end of the third quarter. At the top of the heap, Matthew Stadelman’s Diamond Hill Capital said goodbye to the largest stake of the “upper crust” of funds watched by Insider Monkey, totaling an estimated $982.8 million in stock, and Noam Gottesman’s GLG Partners was right behind this move, as the fund dumped about $11.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 9 funds by the end of the third quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as American International Group Inc (NYSE:AIG) but similarly valued. These stocks are Exelon Corporation (NASDAQ:EXC), TC Energy Corporation (NYSE:TRP), Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), Roper Technologies Inc. (NYSE:ROP), Monster Beverage Corp (NASDAQ:MNST), EOG Resources Inc (NYSE:EOG), and Palo Alto Networks Inc (NASDAQ:PANW). This group of stocks’ market caps resemble AIG’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| EXC | 36 | 1108781 | 1 |
| TRP | 15 | 84084 | -7 |
| VRTX | 55 | 2713283 | -5 |
| ROP | 45 | 1667275 | 4 |
| MNST | 42 | 2134498 | -4 |
| EOG | 47 | 1024547 | 12 |
| PANW | 73 | 5899838 | 4 |
| Average | 44.7 | 2090329 | 0.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 44.7 hedge funds with bullish positions and the average amount invested in these stocks was $2090 million. That figure was $1904 million in AIG’s case. Palo Alto Networks Inc (NASDAQ:PANW) is the most popular stock in this table. On the other hand TC Energy Corporation (NYSE:TRP) is the least popular one with only 15 bullish hedge fund positions. American International Group Inc (NYSE:AIG) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for AIG is 17.8. 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 negative signal and 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 surpassed the market again by 5.6 percentage points. Unfortunately AIG wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); AIG investors were disappointed as the stock returned -4.2% 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 most of these stocks already outperformed the market in 2021.
Follow American International Group Inc. (NYSE:AIG)
Follow American International Group Inc. (NYSE:AIG)
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Disclosure: None. This article was originally published at Insider Monkey.
