After several tireless days we have finished crunching the numbers from nearly 900 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 September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards MasTec, Inc. (NYSE:MTZ).
MasTec, Inc. (NYSE:MTZ) shareholders have witnessed a decrease in hedge fund sentiment recently. MasTec, Inc. (NYSE:MTZ) was in 24 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 41. There were 39 hedge funds in our database with MTZ positions at the end of the second quarter. Our calculations also showed that MTZ isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Richard S. Pzena of Pzena Investment Management
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. Keeping this in mind let’s analyze the new hedge fund action encompassing MasTec, Inc. (NYSE:MTZ).
Do Hedge Funds Think MTZ Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, a change of -38% from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards MTZ over the last 25 quarters. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
Among these funds, Peconic Partners LLC held the most valuable stake in MasTec, Inc. (NYSE:MTZ), which was worth $74.1 million at the end of the third quarter. On the second spot was Citadel Investment Group which amassed $74.1 million worth of shares. Electron Capital Partners, Pzena Investment Management, and Millennium Management 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 Billings Capital Management allocated the biggest weight to MasTec, Inc. (NYSE:MTZ), around 9.77% of its 13F portfolio. Peconic Partners LLC is also relatively very bullish on the stock, designating 6.58 percent of its 13F equity portfolio to MTZ.
Since MasTec, Inc. (NYSE:MTZ) has witnessed declining sentiment from the aggregate hedge fund industry, logic holds that there were a few hedgies that elected to cut their full holdings by the end of the third quarter. At the top of the heap, Richard Driehaus’s Driehaus Capital dropped the largest investment of the 750 funds monitored by Insider Monkey, comprising an estimated $4.2 million in stock, and Mark Coe’s Coe Capital Management was right behind this move, as the fund dumped about $4 million worth. These moves are important to note, as aggregate hedge fund interest fell by 15 funds by the end of the third quarter.
Let’s go over hedge fund activity in other stocks similar to MasTec, Inc. (NYSE:MTZ). We will take a look at Elbit Systems Ltd. (NASDAQ:ESLT), KT Corporation (NYSE:KT), Nexstar Media Group, Inc. (NASDAQ:NXST), Texas Roadhouse Inc (NASDAQ:TXRH), VCA Antech Inc (NASDAQ:WOOF), Stag Industrial Inc (NYSE:STAG), and Inspire Medical Systems, Inc. (NYSE:INSP). This group of stocks’ market valuations match MTZ’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ESLT | 4 | 56484 | 0 |
| KT | 12 | 166766 | -2 |
| NXST | 38 | 874017 | 4 |
| TXRH | 36 | 993486 | -1 |
| WOOF | 26 | 319858 | -1 |
| STAG | 17 | 219383 | 2 |
| INSP | 29 | 478246 | -3 |
| Average | 23.1 | 444034 | -0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.1 hedge funds with bullish positions and the average amount invested in these stocks was $444 million. That figure was $440 million in MTZ’s case. Nexstar Media Group, Inc. (NASDAQ:NXST) is the most popular stock in this table. On the other hand Elbit Systems Ltd. (NASDAQ:ESLT) is the least popular one with only 4 bullish hedge fund positions. MasTec, Inc. (NYSE:MTZ) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MTZ is 37. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 beat the market again by 5.1 percentage points. Unfortunately MTZ wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on MTZ were disappointed as the stock returned 8.1% since the end of September (through 12/9) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
