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 Tutor Perini Corp (NYSE:TPC).
Is TPC a good stock to buy now? Tutor Perini Corp (NYSE:TPC) was in 13 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 16. TPC investors should be aware of a decrease in enthusiasm from smart money in recent months. There were 16 hedge funds in our database with TPC holdings at the end of June. Our calculations also showed that TPC isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. 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 recent hedge fund action regarding Tutor Perini Corp (NYSE:TPC).
Do Hedge Funds Think TPC Is A Good Stock To Buy Now?
At the end of September, a total of 13 of the hedge funds tracked by Insider Monkey were long this stock, a change of -19% from the second quarter of 2020. The graph below displays the number of hedge funds with bullish position in TPC over the last 21 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Renaissance Technologies held the most valuable stake in Tutor Perini Corp (NYSE:TPC), which was worth $6.7 million at the end of the third quarter. On the second spot was Arrowstreet Capital which amassed $5.7 million worth of shares. Two Sigma Advisors, D E Shaw, and AQR Capital Management 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 Levin Capital Strategies allocated the biggest weight to Tutor Perini Corp (NYSE:TPC), around 0.09% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, setting aside 0.03 percent of its 13F equity portfolio to TPC.
Seeing as Tutor Perini Corp (NYSE:TPC) has faced bearish sentiment from the smart money, we can see that there is a sect of funds who were dropping their positions entirely heading into Q4. Intriguingly, Ken Griffin’s Citadel Investment Group dropped the biggest stake of the 750 funds tracked by Insider Monkey, valued at close to $19.8 million in stock. Howard Marks’s fund, Oaktree Capital Management, also cut its stock, about $3.9 million worth. These moves are intriguing to say the least, as total hedge fund interest dropped by 3 funds heading into Q4.
Let’s go over hedge fund activity in other stocks similar to Tutor Perini Corp (NYSE:TPC). These stocks are Tenneco Inc (NYSE:TEN), Avita Medical, Inc. (NASDAQ:RCEL), Tanger Factory Outlet Centers Inc. (NYSE:SKT), Playa Hotels & Resorts N.V. (NASDAQ:PLYA), Apogee Enterprises, Inc. (NASDAQ:APOG), Crossamerica Partners LP (NYSE:CAPL), and Aurora Cannabis Inc. (NYSE:ACB). This group of stocks’ market valuations match TPC’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 10.7 hedge funds with bullish positions and the average amount invested in these stocks was $66 million. That figure was $24 million in TPC’s case. Tenneco Inc (NYSE:TEN) is the most popular stock in this table. On the other hand Crossamerica Partners LP (NYSE:CAPL) is the least popular one with only 1 bullish hedge fund positions. Tutor Perini Corp (NYSE:TPC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for TPC is 61.7. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and still beat the market by 16.2 percentage points. Hedge funds were also right about betting on TPC as the stock returned 16.3% since the end of Q3 (through 12/8) 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.