Shaw Communications Inc (NYSE:SJR) investors should pay attention to a decrease in enthusiasm from smart money recently. Our calculations also showed that SJR isn't among the 30 most popular stocks among hedge funds.
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 flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We're going to take a glance at the key hedge fund action encompassing Shaw Communications Inc (NYSE:SJR).
How have hedgies been trading Shaw Communications Inc (NYSE:SJR)?
Heading into the first quarter of 2019, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from one quarter earlier. By comparison, 12 hedge funds held shares or bullish call options in SJR a year ago. With hedge funds' positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Ken Griffin's Citadel Investment Group has the most valuable position in Shaw Communications Inc (NYSE:SJR), worth close to $111.7 million, comprising 0.1% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, led by Jim Simons, holding a $47.5 million position; 0.1% of its 13F portfolio is allocated to the stock. Other members of the smart money with similar optimism comprise Cliff Asness's AQR Capital Management, John Overdeck and David Siegel's Two Sigma Advisors and D. E. Shaw's D E Shaw.
Since Shaw Communications Inc (NYSE:SJR) has experienced declining sentiment from hedge fund managers, it's safe to say that there were a few money managers that decided to sell off their full holdings last quarter. Intriguingly, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital cut the biggest investment of the 700 funds watched by Insider Monkey, totaling about $3.6 million in stock. J. Alan Reid, Jr.'s fund, Forward Management, also dropped its stock, about $1.1 million worth. These moves are intriguing to say the least, as total hedge fund interest dropped by 2 funds last quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Shaw Communications Inc (NYSE:SJR) but similarly valued. We will take a look at AXA Equitable Holdings, Inc. (NYSE:EQH), Sun Communities Inc (NYSE:SUI), Qurate Retail, Inc. (NASDAQ:QRTEA), and Open Text Corporation (NASDAQ:OTEX). All of these stocks' market caps are similar to SJR's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EQH,26,676154,5 SUI,22,491736,-1 QRTEA,35,959633,-1 OTEX,20,617398,1 Average,25.75,686230,1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.75 hedge funds with bullish positions and the average amount invested in these stocks was $686 million. That figure was $204 million in SJR's case. Qurate Retail, Inc. (NASDAQ:QRTEA) is the most popular stock in this table. On the other hand Open Text Corporation (NASDAQ:OTEX) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks Shaw Communications Inc (NYSE:SJR) is even less popular than OTEX. Our calculations showed that top 15 most popular stocks among hedge funds returned 19.7% through March 15th and outperformed the S&P 500 ETF (SPY) by 6.6 percentage points. A few hedge funds were also right about betting on SJR, though not to the same extent, as the stock returned 16.3% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.