Is The Allstate Corporation (ALL) A Good Stock To Buy?

Hedge fund interest in The Allstate Corporation (NYSE:ALL) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare ALL to other stocks including Dollar General Corp. (NYSE:DG), Equinix, Inc. (REIT) (NASDAQ:EQIX), and Fiat Chrysler Automobiles NV (NYSE:FCAU) to get a better sense of its popularity.

In the eyes of most shareholders, hedge funds are perceived as slow, old financial vehicles of the past. While there are more than 8000 funds in operation at present, We hone in on the aristocrats of this club, approximately 750 funds. These investment experts handle bulk of all hedge funds’ total asset base, and by keeping track of their unrivaled picks, Insider Monkey has deciphered various investment strategies that have historically exceeded Mr. Market. Insider Monkey’s flagship hedge fund strategy outpaced the S&P 500 index by nearly 5 percentage points a year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 27.5% since February 2017 (through March 12th) even though the market was up nearly 25% during the same period. We just shared a list of 6 short targets in our latest quarterly update and they are already down an average of 6% in less than a month.

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We’re going to view the new hedge fund action regarding The Allstate Corporation (NYSE:ALL).

How have hedgies been trading The Allstate Corporation (NYSE:ALL)?

Heading into the first quarter of 2019, a total of 34 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards ALL over the last 14 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.


More specifically, AQR Capital Management was the largest shareholder of The Allstate Corporation (NYSE:ALL), with a stake worth $686.2 million reported as of the end of September. Trailing AQR Capital Management was GLG Partners, which amassed a stake valued at $187.6 million. Two Sigma Advisors, D E Shaw, and Millennium Management were also very fond of the stock, giving the stock large weights in their portfolios.

Seeing as The Allstate Corporation (NYSE:ALL) has witnessed a decline in interest from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of fund managers that decided to sell off their full holdings last quarter. Intriguingly, Gregg Moskowitz’s Interval Partners dumped the biggest position of the 700 funds followed by Insider Monkey, valued at an estimated $13.5 million in stock, and David Harding’s Winton Capital Management was right behind this move, as the fund dropped about $12.8 million worth. These transactions are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks similar to The Allstate Corporation (NYSE:ALL). These stocks are Dollar General Corp. (NYSE:DG), Equinix, Inc. (REIT) (NASDAQ:EQIX), Fiat Chrysler Automobiles NV (NYSE:FCAU), and V.F. Corporation (NYSE:VFC). All of these stocks’ market caps resemble ALL’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DG 30 1295630 -1
EQIX 42 1697510 1
FCAU 34 2240973 1
VFC 27 772231 -5
Average 33.25 1501586 -1

View table here if you experience formatting issues.

As you can see these stocks had an average of 33.25 hedge funds with bullish positions and the average amount invested in these stocks was $1502 million. That figure was $1768 million in ALL’s case. Equinix, Inc. (REIT) (NASDAQ:EQIX) is the most popular stock in this table. On the other hand V.F. Corporation (NYSE:VFC) is the least popular one with only 27 bullish hedge fund positions. The Allstate Corporation (NYSE:ALL) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 15 most popular stocks among hedge funds returned 19.7% through March 15th and outperformed the S&P 500 ETF (SPY) by 6.6 percentage points. Hedge funds were also right about betting on ALL, though not to the same extent, as the stock returned 15.4% and outperformed the market as well.

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