Many prominent investors, including Warren Buffett, David Tepper and Stan Druckenmiller, have been cautious regarding the current bull market and missed out as the stock market reached another high in recent weeks. On the other hand, technology hedge funds weren’t timid and registered double digit market beating gains. Financials, energy and industrial stocks initially suffered the most but many of these stocks delivered strong returns since November and hedge funds actually increased their positions in these stocks. In this article we will find out how hedge fund sentiment towards Mednax Inc. (NYSE:MD) changed recently.
Is Mednax Inc. (NYSE:MD) a bargain? Money managers were in an optimistic mood. The number of long hedge fund positions increased by 4 in recent months. Mednax Inc. (NYSE:MD) was in 23 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 33. Our calculations also showed that MD isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Matthew Hulsizer of PEAK6 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. Now let’s take a look at the key hedge fund action encompassing Mednax Inc. (NYSE:MD).
Do Hedge Funds Think MD Is A Good Stock To Buy Now?
At Q3’s end, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 21% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in MD over the last 25 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Mednax Inc. (NYSE:MD) was held by Starboard Value LP, which reported holding $168.2 million worth of stock at the end of September. It was followed by Arrowstreet Capital with a $19.9 million position. Other investors bullish on the company included D E Shaw, 13D Management, and CaaS Capital. In terms of the portfolio weights assigned to each position 13D Management allocated the biggest weight to Mednax Inc. (NYSE:MD), around 3.36% of its 13F portfolio. Starboard Value LP is also relatively very bullish on the stock, dishing out 3.08 percent of its 13F equity portfolio to MD.
With a general bullishness amongst the heavyweights, some big names were leading the bulls’ herd. CaaS Capital, managed by Frank Fu, initiated the largest position in Mednax Inc. (NYSE:MD). CaaS Capital had $8 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also made a $1.4 million investment in the stock during the quarter. The other funds with brand new MD positions are Matthew Hulsizer’s PEAK6 Capital Management, Donald Sussman’s Paloma Partners, and Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Mednax Inc. (NYSE:MD) but similarly valued. These stocks are Wolverine World Wide, Inc. (NYSE:WWW), National Health Investors Inc (NYSE:NHI), FuelCell Energy, Inc. (NASDAQ:FCEL), The Cheesecake Factory Incorporated (NASDAQ:CAKE), Sterling Check Corp. (NASDAQ:STER), WSFS Financial Corporation (NASDAQ:WSFS), and Enviva Partners, LP (NYSE:EVA). This group of stocks’ market caps are closest to MD’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WWW | 21 | 113931 | 0 |
| NHI | 15 | 19189 | 2 |
| FCEL | 19 | 100272 | 5 |
| CAKE | 20 | 171595 | -6 |
| STER | 22 | 83549 | 22 |
| WSFS | 10 | 79352 | -1 |
| EVA | 8 | 341707 | -1 |
| Average | 16.4 | 129942 | 3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.4 hedge funds with bullish positions and the average amount invested in these stocks was $130 million. That figure was $254 million in MD’s case. Sterling Check Corp. (NASDAQ:STER) is the most popular stock in this table. On the other hand Enviva Partners, LP (NYSE:EVA) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Mednax Inc. (NYSE:MD) is more popular among hedge funds. Our overall hedge fund sentiment score for MD is 79.9. 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 31.1% in 2021 through December 9th and still beat the market by 5.1 percentage points. Unfortunately MD wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on MD were disappointed as the stock returned -8.3% since the end of the third quarter (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 most of these stocks already outperformed the market since 2019.
Follow Pediatrix Medical Group Inc. (NYSE:MD)
Follow Pediatrix Medical Group Inc. (NYSE:MD)
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Disclosure: None. This article was originally published at Insider Monkey.
