The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the fourth quarter, which unveil their equity positions as of December 31st. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Corteva, Inc. (NYSE:CTVA).
Is CTVA stock a buy or sell? Investors who are in the know were betting on the stock. The number of bullish hedge fund positions advanced by 2 in recent months. Corteva, Inc. (NYSE:CTVA) was in 38 hedge funds’ portfolios at the end of December. The all time high for this statistic is 39. Our calculations also showed that CTVA isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 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. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 10 best battery stocks to buy to identify the next stock with 10x upside potential. 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 website. Keeping this in mind let’s take a glance at the key hedge fund action surrounding Corteva, Inc. (NYSE:CTVA).
Do Hedge Funds Think CTVA Is A Good Stock To Buy Now?
At fourth quarter’s end, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. On the other hand, there were a total of 27 hedge funds with a bullish position in CTVA a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Jeffrey Smith’s Starboard Value LP has the biggest position in Corteva, Inc. (NYSE:CTVA), worth close to $558.9 million, accounting for 14.2% of its total 13F portfolio. The second most bullish fund manager is Eminence Capital, led by Ricky Sandler, holding a $308.5 million position; 2.9% of its 13F portfolio is allocated to the company. Other professional money managers that are bullish consist of John Petry’s Sessa Capital, Larry Robbins’s Glenview Capital and Phill Gross and Robert Atchinson’s Adage Capital Management. In terms of the portfolio weights assigned to each position Sessa Capital allocated the biggest weight to Corteva, Inc. (NYSE:CTVA), around 14.95% of its 13F portfolio. Starboard Value LP is also relatively very bullish on the stock, setting aside 14.21 percent of its 13F equity portfolio to CTVA.
As aggregate interest increased, some big names have been driving this bullishness. Horseman Capital Management, managed by John Horseman, initiated the biggest position in Corteva, Inc. (NYSE:CTVA). Horseman Capital Management had $5.6 million invested in the company at the end of the quarter. Javier Velazquez’s Albar Capital also made a $5 million investment in the stock during the quarter. The other funds with new positions in the stock are Gilchrist Berg’s Water Street Capital, Wayne Cooperman’s Cobalt Capital Management, and Michael Gelband’s ExodusPoint Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Corteva, Inc. (NYSE:CTVA) but similarly valued. These stocks are Motorola Solutions Inc (NYSE:MSI), Stanley Black & Decker, Inc. (NYSE:SWK), Canadian Natural Resources Limited (NYSE:CNQ), Archer Daniels Midland Company (NYSE:ADM), Fastenal Company (NASDAQ:FAST), Simon Property Group, Inc (NYSE:SPG), and McKesson Corporation (NYSE:MCK). This group of stocks’ market caps match CTVA’s market cap.
|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 35.7 hedge funds with bullish positions and the average amount invested in these stocks was $772 million. That figure was $1398 million in CTVA’s case. McKesson Corporation (NYSE:MCK) is the most popular stock in this table. On the other hand Canadian Natural Resources Limited (NYSE:CNQ) is the least popular one with only 29 bullish hedge fund positions. Corteva, Inc. (NYSE:CTVA) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for CTVA is 56.7. 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. Hedge funds were also right about betting on CTVA as the stock returned 21.9% since the end of Q4 (through 3/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.