Hedge Funds Are Shopping for Cincinnati Monetary Company (CINF)


Before we spend countless hours researching a company, we like to first analyze what insiders, hedge funds, and multi-billion dollar investors think of the stock. This is a necessary first step in our investment process as our research has shown that consensus returns from elite investors have been exceptional. In the following paragraphs, we learn what the multi-billion dollar investors and hedge funds think of Cincinnati Financial Corporation (NASDAQ):CINF).

Is Cincinnati Financial Corporation (NASDAQ:CINF) is it going to start soon? The smart money was optimistic. The number of long hedge fund positions has increased by 2 in the past few months. Cincinnati Financial Corporation (NASDAQ:CINF) was in 22 hedge fund portfolios at the end of the first quarter of 2021. The all-time high for this statistic is 31. Our calculations also show that CINF is not one of the The 30 most popular stocks among hedge funds (Click for the Q1 ranking).

If you ask most market participants, hedge funds are seen as worthless, old investment vehicles of the past. While over 8000 funds are currently in use, we are sharpening the masters of this group, around 850 funds. These investment professionals oversee most of smart money’s total wealth, and by monitoring their top performing stock picks, Insider Monkey has identified many investment strategies that have historically outperformed the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per year since their launch in March 2017. In addition, our monthly newsletter’s long stock selection portfolio returned 206.8% since March 2017 (through May 2021), outperforming the S&P 500 index by more than 115 percentage points. You can download a sample copy of this newsletter on our website .

Paul Marshall Marshall Wace

Paul Marshall by Marshall Wace

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Do hedge funds think CINF is a good stock to buy now?

At the end of the first quarter, a total of 22 of the hedge funds tracked by Insider Monkey were long on this stock, a 10% change from the fourth quarter of 2020 CINF over the past 23 quarters. Since hedge positions go their usual ups and downs, there is an “upper tier” of notable hedge fund managers who have significantly increased their holdings (or already accumulated large positions).

The largest stake in Cincinnati Financial Corporation (NASDAQ: CINF) was held by Select stock group, which held shares valued at $ 816.3 million at the end of December. It was followed by Marshall Wace LLP with a position of $ 21.7 million. Other investors optimistic about the company included Millennium Management, Citadel Investment Group, and Interval Partners. In terms of portfolio weights assigned to each position, Select Equity Group assigned the largest weight to Cincinnati Financial Corporation (NASDAQ: CINF), approximately 2.97% of its 13F portfolio. Fairpointe capital is also relatively bullish on the stock, spending 0.47 percent of its 13F stock portfolio on CINF.

As one would reasonably expect, key money managers led the herd of cops. Marshall Wace LLP, led by Paul Marshall and Ian Wace, has created the most valuable position in Cincinnati Financial Corporation (NASDAQ: CINF). Marshall Wace LLP had invested $ 21.7 million in the company at the end of the quarter. John Campbell’s Peter Rathjens, Bruce Clarke and Arrowstreet Capital also opened a $ 7.9 million position in the quarter. The following funds were also among the new CINF investors: Dmitry Balyasny’s Balyasny asset management, Michael Geland’s ExodusPoint Capital and Donald Sussmans Paloma partner.

Let’s examine hedge fund activity in other stocks as well – not necessarily in the same industry as Cincinnati Financial Corporation (NASDAQ: CINF), but valued similarly. These stocks are Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY), Mid America Apartment Communities Inc (NYSE:COUNTRY), ASE Technology Holding Co., Ltd. (NYSE:ASX), Penn National Gaming, Inc (NASDAQ:PENN), Nomura Holdings, Inc. (NYSE:NMR), MongoDB, Inc. (NASDAQ:MDB) and Principal Financial Group Inc (NASDAQ:PFG). The market values ​​of this group of stocks are similar to the market value of CINF.

[table] Ticker, number of HFs with positions, total value of HF positions (x1000), change in HF position ALNY, 33.740380, -6 MAA, 25.251877, -1 ASX, 8.232071, -1 PENN, 42.907475, 1 NMR, 10.19579 , 4 MDB, 46.1540962.10 PFG, 31.208237.5 average, 27.9.557226.1.7 [/table]

See table here when formatting problems occur.

As you can see, these stocks had an average of 27.9 hedge funds with bullish positions and the average amount invested in these stocks was $ 557 million. In the case of CINF, that figure was $ 886 million. MongoDB, Inc. (NASDAQ:MDB) is the most popular stock in this table. On the other hand, ASE Technology Holding Co., Ltd. (NYSE:ASX) is the least popular with only 8 bullish hedge fund positions. Cincinnati Financial Corporation (NASDAQ: CINF) isn’t the least popular stock in this group, but interest in hedge funds is still below average. Our hedge fund sentiment score for CINF is 46.7. Stocks with a higher number of hedge fund positions relative to other stocks and relative to their historical range receive a higher sentiment score. Our calculations have shown that Top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, outperforming the S&P 500 ETF (SPY) by 40 percentage points. These stocks rose 23.8% in 2021 through July 16, outperforming the market by 7.7 percentage points. A small number of hedge funds were also right to bet on CINF, if not to the same extent, as the stock returned 15.6% since the end of the first quarter (through July 16), outperforming the market.

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Disclosure: None. This article was originally published at Insider monkey.