In this article we are going to use hedge fund sentiment as a tool and determine whether C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) is a good investment right now. We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) shareholders have witnessed a decrease in activity from the world’s largest hedge funds in recent months. C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) was in 23 hedge funds’ portfolios at the end of March. The all time high for this statistic is 32. There were 29 hedge funds in our database with CHRW holdings at the end of December. Our calculations also showed that CHRW isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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Do Hedge Funds Think CHRW Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of -21% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards CHRW over the last 23 quarters. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, AQR Capital Management, managed by Cliff Asness, holds the largest position in C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW). AQR Capital Management has a $129.6 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which holds a $80 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that are bullish consist of Israel Englander’s Millennium Management, D. E. Shaw’s D E Shaw and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Sandbar Asset Management allocated the biggest weight to C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW), around 0.88% of its 13F portfolio. Sciencast Management is also relatively very bullish on the stock, earmarking 0.7 percent of its 13F equity portfolio to CHRW.
Judging by the fact that C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) has experienced declining sentiment from hedge fund managers, we can see that there is a sect of fund managers that elected to cut their positions entirely last quarter. Intriguingly, Dmitry Balyasny’s Balyasny Asset Management sold off the largest investment of the 750 funds monitored by Insider Monkey, worth close to $37.2 million in stock. fund, Renaissance Technologies, also cut its stock, about $30.7 million worth. These transactions are important to note, as total hedge fund interest fell by 6 funds last quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) but similarly valued. These stocks are CenterPoint Energy, Inc. (NYSE:CNP), Shaw Communications Inc (NYSE:SJR), Nuance Communications Inc. (NASDAQ:NUAN), W.P. Carey Inc. (NYSE:WPC), NortonLifeLock Inc. (NASDAQ:NLOK), Ceridian HCM Holding Inc. (NYSE:CDAY), and Medical Properties Trust, Inc. (NYSE:MPW). This group of stocks’ market values resemble CHRW’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
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As you can see these stocks had an average of 29.9 hedge funds with bullish positions and the average amount invested in these stocks was $1064 million. That figure was $360 million in CHRW’s case. Nuance Communications Inc. (NASDAQ:NUAN) is the most popular stock in this table. On the other hand Shaw Communications Inc (NYSE:SJR) is the least popular one with only 21 bullish hedge fund positions. C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CHRW is 23.3. 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 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately CHRW wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); CHRW investors were disappointed as the stock returned -1.7% since the end of March (through 7/16) 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.
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Disclosure: None. This article was originally published at Insider Monkey.