Is HUN Stock A Buy or Sell?
A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Huntsman Corporation (NYSE:HUN).
Is HUN stock a buy? Huntsman Corporation (NYSE:HUN) was in 29 hedge funds' portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 47. HUN investors should pay attention to an increase in activity from the world's largest hedge funds of late. There were 24 hedge funds in our database with HUN holdings at the end of September. Our calculations also showed that HUN isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).
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 197% since March 2017 and outperformed the S&P 500 ETFs by more than 124 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.
Nick Thakore of Diametric Capital
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind let's analyze the key hedge fund action regarding Huntsman Corporation (NYSE:HUN).
Do Hedge Funds Think HUN Is A Good Stock To Buy Now?
At Q4's end, a total of 29 of the hedge funds tracked by Insider Monkey were long this stock, a change of 21% from the third quarter of 2020. Below, you can check out the change in hedge fund sentiment towards HUN over the last 22 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Huntsman Corporation (NYSE:HUN) was held by Yacktman Asset Management, which reported holding $169.3 million worth of stock at the end of December. It was followed by Holocene Advisors with a $71.3 million position. Other investors bullish on the company included Royce & Associates, Millennium Management, and Arrowstreet Capital. In terms of the portfolio weights assigned to each position Swift Run Capital Management allocated the biggest weight to Huntsman Corporation (NYSE:HUN), around 4.75% of its 13F portfolio. Sandbar Asset Management is also relatively very bullish on the stock, designating 2.48 percent of its 13F equity portfolio to HUN.
As industrywide interest jumped, key hedge funds have jumped into Huntsman Corporation (NYSE:HUN) headfirst. Renaissance Technologies, created the largest position in Huntsman Corporation (NYSE:HUN). Renaissance Technologies had $10.2 million invested in the company at the end of the quarter. John Brennan's Sirios Capital Management also initiated a $3.4 million position during the quarter. The other funds with new positions in the stock are Javier Velazquez's Albar Capital, Nick Thakore's Diametric Capital, and Charles Davidson and Joseph Jacobs's Wexford Capital.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Huntsman Corporation (NYSE:HUN) but similarly valued. We will take a look at Wyndham Hotels & Resorts, Inc. (NYSE:WH), Science Applications International Corp (NYSE:SAIC), Schrodinger, Inc. (NASDAQ:SDGR), Starwood Property Trust, Inc. (NYSE:STWD), People's United Financial, Inc. (NASDAQ:PBCT), Cullen/Frost Bankers, Inc. (NYSE:CFR), and Integra Lifesciences Holdings Corp (NASDAQ:IART). This group of stocks' market valuations resemble HUN's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WH,26,666874,-7 SAIC,28,293156,7 SDGR,24,949690,0 STWD,13,144207,-4 PBCT,29,122766,7 CFR,17,42116,-2 IART,13,89852,-3 Average,21.4,329809,-0.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.4 hedge funds with bullish positions and the average amount invested in these stocks was $330 million. That figure was $513 million in HUN's case. People's United Financial, Inc. (NASDAQ:PBCT) is the most popular stock in this table. On the other hand Starwood Property Trust, Inc. (NYSE:STWD) is the least popular one with only 13 bullish hedge fund positions. Huntsman Corporation (NYSE:HUN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for HUN is 78.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.2% in 2021 through April 12th and still beat the market by 1.5 percentage points. Hedge funds were also right about betting on HUN as the stock returned 15.1% since the end of Q4 (through 4/12) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
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