A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30th, so let’s proceed with the discussion of the hedge fund sentiment on Motorola Solutions Inc (NYSE:MSI).
Is Motorola Solutions Inc (NYSE:MSI) a great investment now? Investors who are in the know were in a pessimistic mood. The number of bullish hedge fund positions went down by 3 in recent months. Motorola Solutions Inc (NYSE:MSI) was in 34 hedge funds’ portfolios at the end of September. The all time high for this statistic is 41. Our calculations also showed that MSI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 37 hedge funds in our database with MSI positions at the end of the second quarter.
Phillip Gross of Adage Capital
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. With all of this in mind we’re going to take a look at the new hedge fund action surrounding Motorola Solutions Inc (NYSE:MSI).
Do Hedge Funds Think MSI Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 34 of the hedge funds tracked by Insider Monkey were long this stock, a change of -8% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards MSI over the last 25 quarters. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
More specifically, Orbis Investment Management was the largest shareholder of Motorola Solutions Inc (NYSE:MSI), with a stake worth $484.3 million reported as of the end of September. Trailing Orbis Investment Management was Newbrook Capital Advisors, which amassed a stake valued at $98.7 million. Citadel Investment Group, Holocene Advisors, and Adage Capital 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 Newbrook Capital Advisors allocated the biggest weight to Motorola Solutions Inc (NYSE:MSI), around 7.18% of its 13F portfolio. Orbis Investment Management is also relatively very bullish on the stock, earmarking 3.33 percent of its 13F equity portfolio to MSI.
Because Motorola Solutions Inc (NYSE:MSI) has experienced a decline in interest from the aggregate hedge fund industry, logic holds that there exists a select few hedgies that slashed their positions entirely in the third quarter. It’s worth mentioning that Leon Shaulov’s Maplelane Capital cut the biggest stake of the “upper crust” of funds monitored by Insider Monkey, comprising about $15.6 million in stock, and Richard SchimeláandáLawrence Sapanski’s Cinctive Capital Management was right behind this move, as the fund dropped about $11.6 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 3 funds in the third quarter.
Let’s go over hedge fund activity in other stocks similar to Motorola Solutions Inc (NYSE:MSI). We will take a look at Cognizant Technology Solutions Corp (NASDAQ:CTSH), Ross Stores, Inc. (NASDAQ:ROST), ResMed Inc. (NYSE:RMD), Republic Services, Inc. (NYSE:RSG), SVB Financial Group (NASDAQ:SIVB), Travelers Companies Inc (NYSE:TRV), and Kinder Morgan Inc (NYSE:KMI). This group of stocks’ market caps match MSI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CTSH | 29 | 2336693 | -12 |
| ROST | 41 | 1220437 | -10 |
| RMD | 28 | 396289 | 2 |
| RSG | 31 | 1222055 | -3 |
| SIVB | 45 | 1207137 | -4 |
| TRV | 32 | 433119 | -2 |
| KMI | 43 | 1012275 | 5 |
| Average | 35.6 | 1118286 | -3.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 35.6 hedge funds with bullish positions and the average amount invested in these stocks was $1118 million. That figure was $1266 million in MSI’s case. SVB Financial Group (NASDAQ:SIVB) is the most popular stock in this table. On the other hand ResMed Inc. (NYSE:RMD) is the least popular one with only 28 bullish hedge fund positions. Motorola Solutions Inc (NYSE:MSI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MSI is 44.5. 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 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. A small number of hedge funds were also right about betting on MSI as the stock returned 9% since the end of the third quarter (through 11/30) and outperformed the market by an even larger margin.
Follow Motorola Solutions Inc. (NYSE:MSI)
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Disclosure: None. This article was originally published at Insider Monkey.
