Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Crown Holdings, Inc. (NYSE:CCK), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is CCK stock a buy or sell? Crown Holdings, Inc. (NYSE:CCK) was in 63 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 58. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. CCK shareholders have witnessed an increase in enthusiasm from smart money of late. There were 47 hedge funds in our database with CCK holdings at the end of September. Our calculations also showed that CCK isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. Recently Oregon became the first state to legalize psychedelic mushrooms which are shown to have promising results in treating depression, addiction, and PTSD in early stage academic studies. So, we are checking out this psychedelic drug stock idea right now. We go through lists like the 10 best biotech stocks to invest in to pick the next stock 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. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage (or at the end of this article). With all of this in mind we’re going to take a look at the new hedge fund action surrounding Crown Holdings, Inc. (NYSE:CCK).
Do Hedge Funds Think CCK Is A Good Stock To Buy Now?
At the end of the fourth quarter, a total of 63 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 34% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CCK over the last 22 quarters. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
Among these funds, Lyrical Asset Management held the most valuable stake in Crown Holdings, Inc. (NYSE:CCK), which was worth $339.8 million at the end of the fourth quarter. On the second spot was Maverick Capital which amassed $152.1 million worth of shares. Southpoint Capital Advisors, Rivulet Capital, and Citadel Investment Group 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 SAYA Management allocated the biggest weight to Crown Holdings, Inc. (NYSE:CCK), around 17.37% of its 13F portfolio. Engle Capital is also relatively very bullish on the stock, earmarking 13.03 percent of its 13F equity portfolio to CCK.
As industrywide interest jumped, some big names were breaking ground themselves. TOMS Capital, managed by Benjamin Pass, created the most outsized position in Crown Holdings, Inc. (NYSE:CCK). TOMS Capital had $80.4 million invested in the company at the end of the quarter. Ben Jacobs’s Anomaly Capital Management also made a $36.4 million investment in the stock during the quarter. The other funds with brand new CCK positions are Eli Cohen’s Crescent Park Management, Guy Shahar’s DSAM Partners, and Brad Farber’s Atika Capital.
Let’s also examine hedge fund activity in other stocks similar to Crown Holdings, Inc. (NYSE:CCK). These stocks are Brookfield Property Partners LP (NASDAQ:BPY), Brown & Brown, Inc. (NYSE:BRO), ON Semiconductor Corporation (NASDAQ:ON), Sarepta Therapeutics Inc (NASDAQ:SRPT), Cable One Inc (NYSE:CABO), Penn National Gaming, Inc (NASDAQ:PENN), and Omnicom Group Inc. (NYSE:OMC). This group of stocks’ market valuations match CCK’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 30.3 hedge funds with bullish positions and the average amount invested in these stocks was $859 million. That figure was $2030 million in CCK’s case. ON Semiconductor Corporation (NASDAQ:ON) is the most popular stock in this table. On the other hand Brookfield Property Partners LP (NASDAQ:BPY) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks Crown Holdings, Inc. (NYSE:CCK) is more popular among hedge funds. Our overall hedge fund sentiment score for CCK is 90. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 5.3% in 2021 through March 19th and still beat the market by 0.8 percentage points. Unfortunately CCK wasn’t nearly as popular as these 30 stocks and hedge funds that were betting on CCK were disappointed as the stock returned -3.5% since the end of the fourth quarter (through 3/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.