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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of June. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Kohl's Corporation (NYSE:KSS), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Kohl's Corporation (NYSE:KSS) shareholders have witnessed an increase in support from the world's most elite money managers recently. Kohl's Corporation (NYSE:KSS) was in 40 hedge funds' portfolios at the end of June. The all time high for this statistic is 42. Our calculations also showed that KSS isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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Fred DiSanto of Ancora Advisors
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Do Hedge Funds Think KSS Is A Good Stock To Buy Now?
At Q2's end, a total of 40 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 14% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards KSS over the last 24 quarters. With the smart money's sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).
Among these funds, Ancora Advisors held the most valuable stake in Kohl's Corporation (NYSE:KSS), which was worth $192.5 million at the end of the second quarter. On the second spot was Arrowstreet Capital which amassed $188.4 million worth of shares. Two Sigma Advisors, Holocene Advisors, and AQR Capital Management 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 Legion Partners Asset Management allocated the biggest weight to Kohl's Corporation (NYSE:KSS), around 7.05% of its 13F portfolio. Ancora Advisors is also relatively very bullish on the stock, dishing out 5.03 percent of its 13F equity portfolio to KSS.
Now, specific money managers were leading the bulls' herd. Dorsal Capital Management, managed by Ryan Frick and Oliver Evans, created the most outsized position in Kohl's Corporation (NYSE:KSS). Dorsal Capital Management had $38.6 million invested in the company at the end of the quarter. Renaissance Technologies also initiated a $24.6 million position during the quarter. The other funds with new positions in the stock are Kamyar Khajavi's MIK Capital, Doug Gordon, Jon Hilsabeck and Don Jabro's Shellback Capital, and Mike Vranos's Ellington.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Kohl's Corporation (NYSE:KSS) but similarly valued. We will take a look at Oshkosh Corporation (NYSE:OSK), Autoliv Inc. (NYSE:ALV), Omega Healthcare Investors Inc (NYSE:OHI), US Foods Holding Corp. (NYSE:USFD), Genpact Limited (NYSE:G), TFI International Inc. (NYSE:TFII), and Under Armour Inc (NYSE:UA). This group of stocks' market valuations are closest to KSS's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position OSK,28,360479,2 ALV,23,860834,3 OHI,20,142609,-5 USFD,35,1399474,-5 G,22,234361,-1 TFII,13,101129,-6 UA,51,1786550,0 Average,27.4,697919,-1.7 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 27.4 hedge funds with bullish positions and the average amount invested in these stocks was $698 million. That figure was $1341 million in KSS's case. Under Armour Inc (NYSE:UA) is the most popular stock in this table. On the other hand TFI International Inc. (NYSE:TFII) is the least popular one with only 13 bullish hedge fund positions. Kohl's Corporation (NYSE:KSS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for KSS is 74.1. 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. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 21.8% in 2021 through October 11th and beat the market again by 4.4 percentage points. Unfortunately KSS wasn't nearly as popular as these 5 stocks and hedge funds that were betting on KSS were disappointed as the stock returned -19% since the end of June (through 10/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.