As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the second quarter. We get to see hedge funds’ thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about Maxar Technologies Inc. (NYSE:MAXR).
Is Maxar Technologies Inc. (NYSE:MAXR) the right investment to pursue these days? The best stock pickers are in a bullish mood. The number of bullish hedge fund bets improved by 5 in recent months. Our calculations also showed that MAXR isn’t among the 30 most popular stocks among hedge funds (see the video below).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
To most traders, hedge funds are perceived as unimportant, old investment vehicles of years past. While there are greater than 8000 funds trading at the moment, We look at the aristocrats of this group, about 750 funds. These investment experts shepherd the majority of all hedge funds’ total asset base, and by paying attention to their unrivaled investments, Insider Monkey has revealed many investment strategies that have historically outstripped the market. Insider Monkey’s flagship hedge fund strategy exceeded the S&P 500 index by around 5 percentage points per year since its inception in May 2014. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 25.7% since February 2017 (through September 30th) even though the market was up more than 33% during the same period. We just shared a list of 10 short targets in our latest quarterly update .
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s take a gander at the recent hedge fund action encompassing Maxar Technologies Inc. (NYSE:MAXR).
Hedge fund activity in Maxar Technologies Inc. (NYSE:MAXR)
At Q2’s end, a total of 12 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 71% from the first quarter of 2019. The graph below displays the number of hedge funds with bullish position in MAXR over the last 16 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.
Among these funds, Alyeska Investment Group held the most valuable stake in Maxar Technologies Inc. (NYSE:MAXR), which was worth $16.5 million at the end of the second quarter. On the second spot was Millennium Management which amassed $14.1 million worth of shares. Moreover, Point State Capital, Sound Point Capital, and Miller Value Partners were also bullish on Maxar Technologies Inc. (NYSE:MAXR), allocating a large percentage of their portfolios to this stock.
As aggregate interest increased, key hedge funds have been driving this bullishness. Point State Capital, managed by Zach Schreiber, created the largest position in Maxar Technologies Inc. (NYSE:MAXR). Point State Capital had $6 million invested in the company at the end of the quarter. Steve Ketchum’s Sound Point Capital also initiated a $1.6 million position during the quarter. The following funds were also among the new MAXR investors: Bill Miller’s Miller Value Partners, Tom Sandell’s Sandell Asset Management, and Minhua Zhang’s Weld Capital Management.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Maxar Technologies Inc. (NYSE:MAXR) but similarly valued. These stocks are SurModics, Inc. (NASDAQ:SRDX), Ichor Holdings, Ltd. (NASDAQ:ICHR), Ultra Clean Holdings Inc (NASDAQ:UCTT), and Crossamerica Partners LP (NYSE:CAPL). This group of stocks’ market valuations are similar to MAXR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SRDX | 14 | 132861 | -3 |
| ICHR | 8 | 51672 | -2 |
| UCTT | 11 | 60376 | 2 |
| CAPL | 1 | 6327 | -3 |
| Average | 8.5 | 62809 | -1.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 8.5 hedge funds with bullish positions and the average amount invested in these stocks was $63 million. That figure was $43 million in MAXR’s case. SurModics, Inc. (NASDAQ:SRDX) is the most popular stock in this table. On the other hand Crossamerica Partners LP (NYSE:CAPL) is the least popular one with only 1 bullish hedge fund positions. Maxar Technologies Inc. (NYSE:MAXR) is not the most popular stock in this group but hedge fund interest is still above average. 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 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately MAXR wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on MAXR were disappointed as the stock returned -2.7% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.
