The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 866 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their March 31st holdings, data that is available nowhere else. Should you consider Vulcan Materials Company (NYSE:VMC) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is VMC a good stock to buy? The best stock pickers were taking an optimistic view. The number of long hedge fund bets increased by 4 recently. Vulcan Materials Company (NYSE:VMC) was in 48 hedge funds’ portfolios at the end of March. The all time high for this statistic is 57. Our calculations also showed that VMC isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 44 hedge funds in our database with VMC holdings at the end of December.
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 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Steven Cohen of Point72 Asset Management
At Insider Monkey we leave no stone unturned when looking for 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, which is why we are checking out this inflation play. We go through lists like 10 best gold stocks to buy to identify promising stocks. 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. With all of this in mind let’s analyze the key hedge fund action regarding Vulcan Materials Company (NYSE:VMC).
Do Hedge Funds Think VMC Is A Good Stock To Buy Now?
Heading into the second quarter of 2021, a total of 48 of the hedge funds tracked by Insider Monkey were long this stock, a change of 9% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards VMC over the last 23 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, John Armitage’s Egerton Capital Limited has the most valuable position in Vulcan Materials Company (NYSE:VMC), worth close to $167.3 million, amounting to 0.9% of its total 13F portfolio. Sitting at the No. 2 spot is Panayotis Takis Sparaggis of Alkeon Capital Management, with a $149.5 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining professional money managers that are bullish include Ken Griffin’s Citadel Investment Group, Sharlyn C. Heslam’s Stockbridge Partners and D. E. Shaw’s D E Shaw. In terms of the portfolio weights assigned to each position Banbury Partners allocated the biggest weight to Vulcan Materials Company (NYSE:VMC), around 9.95% of its 13F portfolio. Park Presidio Capital is also relatively very bullish on the stock, earmarking 6.15 percent of its 13F equity portfolio to VMC.
With a general bullishness amongst the heavyweights, some big names were breaking ground themselves. Point72 Asset Management, managed by Steve Cohen, created the biggest position in Vulcan Materials Company (NYSE:VMC). Point72 Asset Management had $29.7 million invested in the company at the end of the quarter. Michael Cowley’s Sandbar Asset Management also initiated a $16.5 million position during the quarter. The other funds with brand new VMC positions are Baker Burleson and Stormy Scott’s Banbury Partners, Anand Parekh’s Alyeska Investment Group, and Robert Bishop’s Impala Asset Management.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Vulcan Materials Company (NYSE:VMC) but similarly valued. These stocks are EPAM Systems Inc (NYSE:EPAM), EXACT Sciences Corporation (NASDAQ:EXAS), Paycom Software Inc (NYSE:PAYC), Nokia Corporation (NYSE:NOK), Edison International (NYSE:EIX), McCormick & Company, Incorporated (NYSE:MKC), and PPL Corporation (NYSE:PPL). This group of stocks’ market caps match VMC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| EPAM | 24 | 424015 | -8 |
| EXAS | 41 | 2408537 | 1 |
| PAYC | 46 | 969848 | 11 |
| NOK | 21 | 352915 | 2 |
| EIX | 35 | 1564442 | 5 |
| MKC | 35 | 1969760 | -1 |
| PPL | 25 | 152408 | 4 |
| Average | 32.4 | 1120275 | 2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 32.4 hedge funds with bullish positions and the average amount invested in these stocks was $1120 million. That figure was $1317 million in VMC’s case. Paycom Software Inc (NYSE:PAYC) is the most popular stock in this table. On the other hand Nokia Corporation (NYSE:NOK) is the least popular one with only 21 bullish hedge fund positions. Compared to these stocks Vulcan Materials Company (NYSE:VMC) is more popular among hedge funds. Our overall hedge fund sentiment score for VMC is 84.3. 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. 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 17.4% in 2021 through June 18th and still beat the market by 6.1 percentage points. Unfortunately VMC wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on VMC were disappointed as the stock returned -1.5% since the end of the first quarter (through 6/18) 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 since 2019.
Follow Vulcan Materials Co (NYSE:VMC)
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Disclosure: None. This article was originally published at Insider Monkey.
