By Matt Doiron
We have been pooling 13F filings from hedge funds and other notable investors such as Warren Buffett in our database, which we use to provide useful information to investors. Even with the delay associated with 13F filings, the most popular small-cap stocks among hedge funds outperform the market by an average of 18 percentage points per year (see the list of these stocks and their returns since September). We also like to see which stocks in different categories are the most popular overall, including in different sectors of the economy. Here are the 10 consumer goods stocks that the largest number of hedge funds reported owning at the end of December:
The top consumer goods stock was Mondelez International (MDLZ), with 59 hedge funds and other investors in our database of 13F filings reporting a position. Mondelez was created from the breakup of Kraft Foods; Mondelez now owns the global snack brands previously associated with Kraft. Boykin Curry's Eagle Capital Management had over 17 million shares in its portfolio.
Fifty-eight filers in our database reported a position in Coca-Cola (KO), down from 66 three months earlier. Warren Buffett is well known for his position in Coca-Cola, as it is a classic example of a strong brand name and has a history of creating long-term value for shareholders. Berkshire Hathaway is still a major shareholder and owned 400 million shares of Coca-Cola (find Buffett's favorite stocks).
Coca-Cola wasn't the only soft drink company hedge funds loved: we counted 46 13F filings disclosing a position in peer Pepsico (PEP) though Pepsi also owns a number of snack businesses as well. Renaissance Technologies, whose founder Jim Simons is now a billionaire, initiated a position of 2.6 million shares between October and December.
Philip Morris International (PM) was another hedge fund favorite as 46 funds and other notable investors owned shares of the cigarette company. It markets the Philip Morris brands in international markets following the breakup of Philip Morris several years ago. Billionaire Ken Fisher's Fisher Asset Management reported owning 5.7 million shares of Philip Morris.
Our database included 39 owners of upmarket accessories provider Michael Kors Holdings (KORS), down from 48 in the third quarter of 2012. Lone Pine Capital, managed by billionaire and Tiger Cub Stephen Mandel, increased its stake in Michael Kors to a total of over 9 million shares.
Hedge fund ownership of Nike (NKE) ticked up a bit to a total of 38 filers. Billionaire Steve Cohen's SAC Capital Advisors moved heavily into the stock during Q4 and closed December with 2.6 million shares (find more stocks SAC owned).
Mondelez was the top consumer pick but Kraft Foods (KRFT) also made our list of the most popular consumer goods stock as 37 filers reported a position. Citadel Investment Group was one of the largest holders of the stock in our database; that fund is managed by billionaire Ken Griffin.
Hillshire Brands (HSH) was owned by 33 different hedge funds at the end of December, up from 23 at the beginning of October. Among the funds buying Hillshire during the fourth quarter was billionaire John Paulson's Paulson & Co.
Thirty-three hedge funds and other investors in our database were also counted as owning shares of Constellation Brands (STZ). While billionaire and well-known activist investor Dan Loeb's Third Point was selling shares, it still owned 1.9 million shares at the beginning of 2013.
The 10th most popular consumer stock among hedge funds, per our methodology, was Mohawk Industries (MHK), a $7.2 billion market cap company which provides carpets, tiles, and other floor coverings. Theleme Partners was one fund taking a new position in Mohawk.