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 Core-Mark Holding Company, Inc. (NASDAQ:CORE) based on that data.
Core-Mark Holding Company, Inc. (NASDAQ:CORE) shareholders have witnessed an increase in support from the world's most elite money managers in recent months. Our calculations also showed that CORE 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_693173" align="aligncenter" width="400"] Paul Hondros of AlphaOne Capital[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we're going to take a gander at the new hedge fund action surrounding Core-Mark Holding Company, Inc. (NASDAQ:CORE).
What does smart money think about Core-Mark Holding Company, Inc. (NASDAQ:CORE)?
At Q1's end, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 19% from the previous quarter. The graph below displays the number of hedge funds with bullish position in CORE over the last 18 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, D E Shaw was the largest shareholder of Core-Mark Holding Company, Inc. (NASDAQ:CORE), with a stake worth $7.4 million reported as of the end of September. Trailing D E Shaw was Renaissance Technologies, which amassed a stake valued at $2.5 million. Millennium Management, Citadel Investment Group, and Marshall Wace LLP 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 Algert Coldiron Investors allocated the biggest weight to Core-Mark Holding Company, Inc. (NASDAQ:CORE), around 0.52% of its 13F portfolio. Zebra Capital Management is also relatively very bullish on the stock, earmarking 0.51 percent of its 13F equity portfolio to CORE.
As industrywide interest jumped, specific money managers were leading the bulls' herd. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, created the biggest position in Core-Mark Holding Company, Inc. (NASDAQ:CORE). Marshall Wace LLP had $1.4 million invested in the company at the end of the quarter. Peter Muller's PDT Partners also initiated a $1.3 million position during the quarter. The following funds were also among the new CORE investors: Hoon Kim's Quantinno Capital, Ryan Tolkin (CIO)'s Schonfeld Strategic Advisors, and Paul Hondros's AlphaOne Capital Partners.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Core-Mark Holding Company, Inc. (NASDAQ:CORE) but similarly valued. These stocks are Innovative Industrial Properties, Inc. (NYSE:IIPR), Revolution Medicines, Inc. (NASDAQ:RVMD), Lions Gate Entertainment Corporation (NYSE:LGF-A), and Equitrans Midstream Corporation (NYSE:ETRN). This group of stocks' market valuations are closest to CORE's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IIPR,14,99011,-2 RVMD,20,223473,20 LGF-A,23,207237,4 ETRN,19,227760,4 Average,19,189370,6.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19 hedge funds with bullish positions and the average amount invested in these stocks was $189 million. That figure was $24 million in CORE's case. Lions Gate Entertainment Corporation (NYSE:LGF-A) is the most popular stock in this table. On the other hand Innovative Industrial Properties, Inc. (NYSE:IIPR) is the least popular one with only 14 bullish hedge fund positions. Core-Mark Holding Company, Inc. (NASDAQ:CORE) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.4% in 2020 through June 22nd and surpassed the market by 15.9 percentage points. Unfortunately CORE wasn't nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); CORE investors were disappointed as the stock returned -14% during the second quarter 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 in 2020.
Disclosure: None. This article was originally published at Insider Monkey.