After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of March 31. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Concho Resources Inc. (NYSE:CXO).
Is Concho Resources Inc. (NYSE:CXO) a buy, sell, or hold? Hedge funds are turning less bullish. The number of long hedge fund bets were trimmed by 9 lately. Our calculations also showed that CXO isn't among the 30 most popular stocks among hedge funds. CXO was in 26 hedge funds' portfolios at the end of the first quarter of 2019. There were 35 hedge funds in our database with CXO holdings at the end of the previous quarter.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let's review the key hedge fund action surrounding Concho Resources Inc. (NYSE:CXO).
How are hedge funds trading Concho Resources Inc. (NYSE:CXO)?
Heading into the second quarter of 2019, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of -26% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CXO over the last 15 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Citadel Investment Group was the largest shareholder of Concho Resources Inc. (NYSE:CXO), with a stake worth $269.3 million reported as of the end of March. Trailing Citadel Investment Group was Point72 Asset Management, which amassed a stake valued at $73.1 million. Alyeska Investment Group, Adage Capital Management, and Citadel Investment Group were also very fond of the stock, giving the stock large weights in their portfolios.