Is MFC Industrial Ltd (NYSE:MIL) a good stock to buy right now? We, at Insider Monkey, like to examine what billionaires and hedge funds think of a company before doing days of research on it. Given their 2 and 20 payment structure, hedge funds have more resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also have numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
MFC Industrial Ltd (NYSE:MIL) investors should pay attention to a decrease in enthusiasm from smart money lately. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Repros Therapeutics Inc (NASDAQ:RPRX), SeaSpine Holdings Corp (NASDAQ:SPNE), and Avinger Inc (NASDAQ:AVGR) to gather more data points.
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Keeping this in mind, we’re going to take a peek at the recent action encompassing MFC Industrial Ltd (NYSE:MIL).
How have hedgies been trading MFC Industrial Ltd (NYSE:MIL)?
At the end of Q3, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a drop of 33% from the previous quarter. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, D E Shaw holds the number one position in MFC Industrial Ltd (NYSE:MIL). D E Shaw has a $1.1 million position in the stock, comprising less than 0.1% of its 13F portfolio. Coming in second is Renaissance Technologies, holding a $0.7 million position; less than 0.1% of its 13F portfolio is allocated to the company. Other peers with similar optimism encompass Chuck Royce’s Royce & Associates, and John Overdeck and David Siegel’s Two Sigma Advisors.
Because MFC Industrial Ltd (NYSE:MIL) has faced a declining sentiment from hedge fund managers, it’s safe to say that there exists a select few money managers who sold off their positions entirely by the end of the third quarter. Interestingly, Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners dumped the biggest position of the “upper crust” of funds monitored by Insider Monkey, valued at close to $47,000 in stock. Ken Griffin’s fund, Citadel Investment Group, also dumped its stock, about $40,000 worth of shares. These bearish behaviors are important to note, as total hedge fund interest fell by 2 funds by the end of the third quarter.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as MFC Industrial Ltd (NYSE:MIL) but similarly valued. These stocks are Repros Therapeutics Inc (NASDAQ:RPRX), SeaSpine Holdings Corp (NASDAQ:SPNE), Avinger Inc (NASDAQ:AVGR), and Quinpario Acquisition Corp 2 (NASDAQ:QPACU). This group of stocks’ market caps are similar to MIL’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RPRX | 17 | 44493 | -2 |
| SPNE | 11 | 63426 | 11 |
| AVGR | 5 | 14538 | 0 |
| QPACU | 16 | 158867 | 0 |
As you can see these stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $70 million. That figure was $2 million in MIL’s case. Repros Therapeutics Inc (NASDAQ:RPRX) is the most popular stock in this table. On the other hand Avinger Inc (NASDAQ:AVGR) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks MFC Industrial Ltd (NYSE:MIL) is even less popular than AVGR. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.
