How do you pick the next stock to invest in? One way would be to spend hours of research browsing through thousands of publicly traded companies. However, an easier way is to look at the stocks that smart money investors are collectively bullish on. Hedge funds and other institutional investors usually invest large amounts of capital and have to conduct due diligence while choosing their next pick. They don’t always get it right, but, on average, their stock picks historically generated strong returns after adjusting for known risk factors. With this in mind, let’s take a look at the recent hedge fund activity surrounding The WhiteWave Foods Co (NYSE:WWAV).
Is The WhiteWave Foods Co (NYSE:WWAV) a good investment now? Prominent investors are getting more optimistic. The number of bullish hedge fund positions inched up by 3 lately. WWAV was in 33 hedge funds’ portfolios at the end of September. There were 30 hedge funds in our database with WWAV positions at the end of the previous quarter. At the end of this article we will also compare WWAV to other stocks including Torchmark Corporation (NYSE:TMK), CDW Corp (NASDAQ:CDW), and Brixmor Property Group Inc (NYSE:BRX) to get a better sense of its popularity.
Follow Whitewave Foods Co (NYSE:WWAV)
Follow Whitewave Foods Co (NYSE:WWAV)
Keeping this in mind, let’s view the latest action encompassing The WhiteWave Foods Co (NYSE:WWAV).
What have hedge funds been doing with The WhiteWave Foods Co (NYSE:WWAV)?
Heading into Q4, a total of 33 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 10% from the second quarter. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, York Capital Management, managed by James Dinan, holds the number one position in The WhiteWave Foods Co (NYSE:WWAV). York Capital Management has a $134.5 million position in the stock, comprising 1.8% of its 13F portfolio. The second largest stake is held by Miura Global Management, managed by Pasco Alfaro / Richard Tumure, which holds a $128.5 million position; 7% of its 13F portfolio is allocated to the company. Other members of the smart money with similar optimism encompass John Paulson’s Paulson & Co, and D E Shaw.
As aggregate interest increased, key money managers have been driving this bullishness. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, established the most outsized position in The WhiteWave Foods Co (NYSE:WWAV). Arrowstreet Capital had $17.9 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $15.3 million investment in the stock during the quarter. The following funds were also among the new WWAV investors: George Hall’s Clinton Group, Neil Chriss’s Hutchin Hill Capital, and Mike Vranos’s Ellington.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as The WhiteWave Foods Co (NYSE:WWAV) but similarly valued. We will take a look at Torchmark Corporation (NYSE:TMK), CDW Corp (NASDAQ:CDW), Brixmor Property Group Inc (NYSE:BRX), and Signature Bank (NASDAQ:SBNY). All of these stocks’ market caps are closest to WWAV’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TMK | 24 | 547957 | 10 |
| CDW | 29 | 510900 | 2 |
| BRX | 9 | 95058 | -5 |
| SBNY | 25 | 424027 | -3 |
As you can see these stocks had an average of 21.75 hedge funds with bullish positions and the average amount invested in these stocks was $394 million. That figure was $691 million in WWAV’s case. CDW Corp (NASDAQ:CDW) is the most popular stock in this table. On the other hand Brixmor Property Group Inc (NYSE:BRX) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks The WhiteWave Foods Co (NYSE:WWAV) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
