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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 third 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 5 years and analyze what the smart money thinks of Willis Towers Watson Public Limited Company (NASDAQ:WLTW) based on that data.
Is WLTW a good stock to buy now? Willis Towers Watson (NASDAQ:WLTW) investors should pay attention to an increase in hedge fund interest lately. Willis Towers Watson Public Limited Company (NASDAQ:WLTW) was in 51 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistics is 49. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 49 hedge funds in our database with WLTW holdings at the end of June. Our calculations also showed that WLTW isn't among the 30 most popular stocks among hedge funds (click for Q3 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.
Today there are several methods market participants use to appraise their holdings. A pair of the most under-the-radar methods are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the best picks of the best money managers can beat the broader indices by a superb amount (see the details here).
William Von Mueffling of Cantillon Capital Management
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 5 best cheap stocks to buy according to Ray Dalio to identify stocks with 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. Now we're going to take a glance at the fresh hedge fund action encompassing Willis Towers Watson Public Limited Company (NASDAQ:WLTW).
What does smart money think about Willis Towers Watson Public Limited Company (NASDAQ:WLTW)?
At Q3's end, a total of 51 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 4% from one quarter earlier. On the other hand, there were a total of 39 hedge funds with a bullish position in WLTW a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
The largest stake in Willis Towers Watson Public Limited Company (NASDAQ:WLTW) was held by Cantillon Capital Management, which reported holding $490.1 million worth of stock at the end of September. It was followed by Millennium Management with a $262.4 million position. Other investors bullish on the company included Abrams Capital Management, Magnetar Capital, and Alpine Associates. In terms of the portfolio weights assigned to each position Hunting Hill Global Capital allocated the biggest weight to Willis Towers Watson Public Limited Company (NASDAQ:WLTW), around 18.97% of its 13F portfolio. Jet Capital Investors is also relatively very bullish on the stock, dishing out 10.64 percent of its 13F equity portfolio to WLTW.
As one would reasonably expect, specific money managers have jumped into Willis Towers Watson Public Limited Company (NASDAQ:WLTW) headfirst. D E Shaw, managed by D. E. Shaw, assembled the largest position in Willis Towers Watson Public Limited Company (NASDAQ:WLTW). D E Shaw had $110.9 million invested in the company at the end of the quarter. Simon Sadler's Segantii Capital also made a $50.2 million investment in the stock during the quarter. The following funds were also among the new WLTW investors: Adam Guren's Hunting Hill Global Capital, Farallon Capital, and Peter Seuss's Prana Capital Management.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Willis Towers Watson Public Limited Company (NASDAQ:WLTW) but similarly valued. These stocks are Wipro Limited (NYSE:WIT), Motorola Solutions Inc (NYSE:MSI), Marvell Technology Group Ltd. (NASDAQ:MRVL), Franco-Nevada Corporation (NYSE:FNV), The Clorox Company (NYSE:CLX), Ford Motor Company (NYSE:F), and Carrier Global Corporation (NYSE:CARR). This group of stocks' market values are closest to WLTW's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WIT,9,93034,2 MSI,29,873220,-7 MRVL,37,479168,-4 FNV,31,1518534,8 CLX,39,1898007,3 F,38,1079806,8 CARR,49,1880405,5 Average,33.1,1117453,2.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.1 hedge funds with bullish positions and the average amount invested in these stocks was $1117 million. That figure was $2618 million in WLTW's case. Carrier Global Corporation (NYSE:CARR) is the most popular stock in this table. On the other hand Wipro Limited (NYSE:WIT) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks Willis Towers Watson Public Limited Company (NASDAQ:WLTW) is more popular among hedge funds. Our overall hedge fund sentiment score for WLTW is 87. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 31.6% in 2020 through December 2nd and still beat the market by 16 percentage points. Unfortunately WLTW wasn't nearly as popular as these 20 stocks and hedge funds that were betting on WLTW were disappointed as the stock returned 1.8% since the end of the third quarter (through 12/2) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.