Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the first quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Cushman & Wakefield plc (NYSE:CWK) based on that data.
Cushman & Wakefield plc (NYSE:CWK) shareholders have witnessed a decrease in hedge fund sentiment in recent months. CWK was in 15 hedge funds' portfolios at the end of March. There were 18 hedge funds in our database with CWK holdings at the end of the previous quarter. Our calculations also showed that CWK isn't among the 30 most popular stocks among hedge funds (click for Q1 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 101% since March 2017 and outperformed the S&P 500 ETFs by more than 58 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.
[caption id="attachment_746830" align="aligncenter" width="400"] Matthew Hulsizer of PEAK6 Capital[/caption]
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, we take a look at lists like the 10 PayPal alternatives for international payments to identify emerging companies that are likely to deliver 1000% gains in the coming years. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind we're going to go over the latest hedge fund action encompassing Cushman & Wakefield plc (NYSE:CWK).
What have hedge funds been doing with Cushman & Wakefield plc (NYSE:CWK)?
At the end of the first quarter, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of -17% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CWK over the last 18 quarters. With hedgies' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Anthony Bozza's Lakewood Capital Management has the number one position in Cushman & Wakefield plc (NYSE:CWK), worth close to $56.1 million, comprising 2.6% of its total 13F portfolio. Sitting at the No. 2 spot is Paul Marshall and Ian Wace of Marshall Wace LLP, with a $9.8 million position; 0.1% of its 13F portfolio is allocated to the stock. Other members of the smart money that hold long positions consist of Ken Griffin's Citadel Investment Group, D. E. Shaw's D E Shaw and Dmitry Balyasny's Balyasny Asset Management. In terms of the portfolio weights assigned to each position Lakewood Capital Management allocated the biggest weight to Cushman & Wakefield plc (NYSE:CWK), around 2.57% of its 13F portfolio. AlphaCrest Capital Management is also relatively very bullish on the stock, dishing out 0.11 percent of its 13F equity portfolio to CWK.
Since Cushman & Wakefield plc (NYSE:CWK) has faced falling interest from the entirety of the hedge funds we track, logic holds that there is a sect of funds who sold off their full holdings last quarter. It's worth mentioning that Stuart J. Zimmer's Zimmer Partners sold off the largest stake of the 750 funds followed by Insider Monkey, worth close to $25.4 million in stock, and Will Cook's Sunriver Management was right behind this move, as the fund said goodbye to about $19 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 3 funds last quarter.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Cushman & Wakefield plc (NYSE:CWK) but similarly valued. These stocks are Coherent, Inc. (NASDAQ:COHR), Viavi Solutions Inc (NASDAQ:VIAV), CRISPR Therapeutics AG (NASDAQ:CRSP), and Inovalon Holdings Inc (NASDAQ:INOV). This group of stocks' market valuations match CWK's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position COHR,23,172545,-5 VIAV,31,305459,-6 CRSP,31,197848,1 INOV,15,71699,-1 Average,25,186888,-2.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $187 million. That figure was $90 million in CWK's case. Viavi Solutions Inc (NASDAQ:VIAV) is the most popular stock in this table. On the other hand Inovalon Holdings Inc (NASDAQ:INOV) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks Cushman & Wakefield plc (NYSE:CWK) is even less popular than INOV. Hedge funds dodged a bullet by taking a bearish stance towards CWK. Our calculations showed that the top 10 most popular hedge fund stocks returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but managed to beat the market by 16.8 percentage points. Unfortunately CWK wasn't nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); CWK investors were disappointed as the stock returned 6.5% during the second quarter (through June 25th) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.
Disclosure: None. This article was originally published at Insider Monkey.