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 700 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 31 holdings, data that is available nowhere else. Should you consider The Clorox Company (NYSE:CLX) for your portfolio? We'll look to this invaluable collective wisdom for the answer.
Is The Clorox Company (NYSE:CLX) worth your attention right now? Hedge funds are in a bullish mood. The number of long hedge fund bets improved by 1 lately. Our calculations also showed that clx isn't among the 30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to check out the new hedge fund action regarding The Clorox Company (NYSE:CLX).
How have hedgies been trading The Clorox Company (NYSE:CLX)?
At the end of the first quarter, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 4% from the previous quarter. By comparison, 16 hedge funds held shares or bullish call options in CLX a year ago. With the smart money's positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).
The largest stake in The Clorox Company (NYSE:CLX) was held by Cedar Rock Capital, which reported holding $462.7 million worth of stock at the end of March. It was followed by Renaissance Technologies with a $356.5 million position. Other investors bullish on the company included AQR Capital Management, Adage Capital Management, and Winton Capital Management.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls' herd. Bridgewater Associates, managed by Ray Dalio, initiated the most valuable position in The Clorox Company (NYSE:CLX). Bridgewater Associates had $8.4 million invested in the company at the end of the quarter. Jeffrey Talpins's Element Capital Management also initiated a $1.2 million position during the quarter. The following funds were also among the new CLX investors: David Costen Haley's HBK Investments, Gavin Saitowitz and Cisco J. del Valle's Springbok Capital, and Alec Litowitz and Ross Laser's Magnetar Capital.
Let's check out hedge fund activity in other stocks similar to The Clorox Company (NYSE:CLX). These stocks are Aptiv PLC (NYSE:APTV), TAL Education Group (NYSE:TAL), Shopify Inc (NYSE:SHOP), and Telefonica Brasil SA (NYSE:VIV). This group of stocks' market caps match CLX's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position APTV,33,791655,-11 TAL,25,1055553,1 SHOP,25,1230786,-4 VIV,9,69810,-3 Average,23,786951,-4.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 23 hedge funds with bullish positions and the average amount invested in these stocks was $787 million. That figure was $1070 million in CLX's case. Aptiv PLC (NYSE:APTV) is the most popular stock in this table. On the other hand Telefonica Brasil SA (NYSE:VIV) is the least popular one with only 9 bullish hedge fund positions. The Clorox Company (NYSE:CLX) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately CLX wasn't nearly as popular as these 20 stocks and hedge funds that were betting on CLX were disappointed as the stock returned -6.2% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.