Technology stocks had a lousy start to 2022. QQQ lost 9% of its value in January. Pandemic winners are getting crushed while energy stocks are surging. Roblox lost 36%, Moderna lost 33%, and Carvana and Shopify lost 30% of their values in January. We aren’t certain about the bubbly technology stocks that trade for ridiculously high multiples of their revenues, but we believe top hedge fund stocks will deliver positive returns for the rest of the year. In this article, we will take a closer look at hedge fund sentiment towards Fortive Corporation (NYSE:FTV) at the end of the third quarter and determine whether the smart money was really smart about this stock.
Fortive Corporation (NYSE:FTV) has experienced an increase in enthusiasm from smart money lately. Fortive Corporation (NYSE:FTV) was in 32 hedge funds’ portfolios at the end of September. The all time high for this statistic is 46. There were 31 hedge funds in our database with FTV positions at the end of the second quarter. Our calculations also showed that FTV isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
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. Now we’re going to take a gander at the key hedge fund action surrounding Fortive Corporation (NYSE:FTV).
Do Hedge Funds Think FTV Is A Good Stock To Buy Now?
At the end of September, a total of 32 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards FTV over the last 25 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Andreas Halvorsen’s Viking Global has the number one position in Fortive Corporation (NYSE:FTV), worth close to $762.7 million, amounting to 2.1% of its total 13F portfolio. On Viking Global’s heels is Select Equity Group, led by Robert Joseph Caruso, holding a $264.6 million position; 0.9% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors that hold long positions encompass Phill Gross and Robert Atchinson’s Adage Capital Management, Daniel Sundheim’s D1 Capital Partners and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Cartenna Capital allocated the biggest weight to Fortive Corporation (NYSE:FTV), around 4.05% of its 13F portfolio. Shellback Capital is also relatively very bullish on the stock, designating 2.17 percent of its 13F equity portfolio to FTV.
Now, specific money managers were leading the bulls’ herd. Interval Partners, managed by Gregg Moskowitz, initiated the most valuable position in Fortive Corporation (NYSE:FTV). Interval Partners had $12.6 million invested in the company at the end of the quarter. Peter Avellone’s Cartenna Capital also made a $10.9 million investment in the stock during the quarter. The other funds with brand new FTV positions are Marc Lisker, Glenn Fuhrman and John Phelan’s MSDC Management, Till Bechtolsheimer’s Arosa Capital Management, and Robert Vincent McHugh’s Jade Capital Advisors.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Fortive Corporation (NYSE:FTV) but similarly valued. We will take a look at Realty Income Corporation (NYSE:O), Coca-Cola European Partners plc (NYSE:CCEP), PT Telekomunikasi Indonesia (NYSE:TLK), Toast Inc. (NYSE:TOST), CDW Corporation (NASDAQ:CDW), Avantor, Inc. (NYSE:AVTR), and Ryanair Holdings plc (NASDAQ:RYAAY). This group of stocks’ market values are similar to FTV’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| O | 22 | 275031 | -1 |
| CCEP | 32 | 1192664 | 1 |
| TLK | 4 | 170252 | -1 |
| TOST | 38 | 567350 | 38 |
| CDW | 37 | 1906004 | 10 |
| AVTR | 53 | 2439815 | 9 |
| RYAAY | 15 | 411390 | 0 |
| Average | 28.7 | 994644 | 8 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 28.7 hedge funds with bullish positions and the average amount invested in these stocks was $995 million. That figure was $2130 million in FTV’s case. Avantor, Inc. (NYSE:AVTR) is the most popular stock in this table. On the other hand PT Telekomunikasi Indonesia (NYSE:TLK) is the least popular one with only 4 bullish hedge fund positions. Fortive Corporation (NYSE:FTV) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FTV is 55.4. 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 29.6% in 2021 and still managed to beat the market by another 3.6 percentage points. Hedge funds were somewhat right about betting on FTV as the stock returned 0% since the end of September (through January 31st) and outperformed the top 5 hedge fund stocks but not the market. This is a rare phenomenon as top hedge fund stocks usually beat the market over the long-term.
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Disclosure: None. This article was originally published at Insider Monkey.
