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Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards V.F. Corporation (NYSE:VFC).
V.F. Corporation (NYSE:VFC) has seen a decrease in hedge fund interest lately. V.F. Corporation (NYSE:VFC) was in 23 hedge funds' portfolios at the end of September. The all time high for this statistic is 36. Our calculations also showed that VFC isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind we're going to take a look at the fresh hedge fund action encompassing V.F. Corporation (NYSE:VFC).
Do Hedge Funds Think VFC Is A Good Stock To Buy Now?
At third quarter's end, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -28% from the previous quarter. The graph below displays the number of hedge funds with bullish position in VFC over the last 25 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Arrowstreet Capital was the largest shareholder of V.F. Corporation (NYSE:VFC), with a stake worth $94.7 million reported as of the end of September. Trailing Arrowstreet Capital was Bridgewater Associates, which amassed a stake valued at $39.7 million. D E Shaw, Citadel Investment Group, and Citadel Investment Group 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 Galibier Capital Management allocated the biggest weight to V.F. Corporation (NYSE:VFC), around 2.62% of its 13F portfolio. Quantamental Technologies is also relatively very bullish on the stock, setting aside 0.96 percent of its 13F equity portfolio to VFC.
Seeing as V.F. Corporation (NYSE:VFC) has experienced bearish sentiment from the smart money, logic holds that there exists a select few hedge funds who were dropping their positions entirely by the end of the third quarter. Intriguingly, Matthew Stadelman's Diamond Hill Capital dumped the largest stake of the 750 funds tracked by Insider Monkey, worth close to $444.4 million in stock. Jack Woodruff's fund, Candlestick Capital Management, also sold off its stock, about $61.5 million worth. These moves are important to note, as total hedge fund interest was cut by 9 funds by the end of the third quarter.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as V.F. Corporation (NYSE:VFC) but similarly valued. These stocks are Deutsche Bank AG (NYSE:DB), Peloton Interactive, Inc. (NASDAQ:PTON), Best Buy Co., Inc. (NYSE:BBY), Interactive Brokers Group, Inc. (NASDAQ:IBKR), Energy Transfer L.P. (NYSE:ET), ONEOK, Inc. (NYSE:OKE), and Generac Holdings Inc. (NYSE:GNRC). This group of stocks' market valuations match VFC's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position DB,15,1795111,-5 PTON,62,4634220,-5 BBY,29,679878,2 IBKR,31,1477413,-5 ET,29,727715,0 OKE,18,124365,-8 GNRC,39,725200,1 Average,31.9,1451986,-2.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 31.9 hedge funds with bullish positions and the average amount invested in these stocks was $1452 million. That figure was $285 million in VFC's case. Peloton Interactive, Inc. (NASDAQ:PTON) is the most popular stock in this table. On the other hand Deutsche Bank AG (NYSE:DB) is the least popular one with only 15 bullish hedge fund positions. V.F. Corporation (NYSE:VFC) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for VFC is 23.7. 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 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. A small number of hedge funds were also right about betting on VFC as the stock returned 14.2% since the end of the third quarter (through 12/9) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.