The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 867 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. In this article we look at what those investors think of Magnite Inc. (NASDAQ:MGNI).
Is MGNI a good stock to buy now? Prominent investors were taking a bearish view. The number of bullish hedge fund bets fell by 3 in recent months. Magnite Inc. (NASDAQ:MGNI) was in 26 hedge funds’ portfolios at the end of September. The all time high for this statistic is 29. Our calculations also showed that MGNI isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 29 hedge funds in our database with MGNI positions at the end of the second quarter.
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 let’s take a look at the key hedge fund action regarding Magnite Inc. (NASDAQ:MGNI).
David Siegel of Two Sigma Advisors
Do Hedge Funds Think MGNI Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of -10% from the second quarter of 2021. The graph below displays the number of hedge funds with bullish position in MGNI over the last 25 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.
The largest stake in Magnite Inc. (NASDAQ:MGNI) was held by Nine Ten Partners, which reported holding $51.5 million worth of stock at the end of September. It was followed by Citadel Investment Group with a $35.9 million position. Other investors bullish on the company included Hidden Lake Asset Management, Collaborative Holdings Management, and Alta Park Capital. In terms of the portfolio weights assigned to each position Collaborative Holdings Management allocated the biggest weight to Magnite Inc. (NASDAQ:MGNI), around 7.49% of its 13F portfolio. P.A.W. CAPITAL PARTNERS is also relatively very bullish on the stock, earmarking 6.23 percent of its 13F equity portfolio to MGNI.
Because Magnite Inc. (NASDAQ:MGNI) has experienced a decline in interest from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of hedgies that slashed their full holdings by the end of the third quarter. Intriguingly, Renaissance Technologies sold off the biggest stake of the “upper crust” of funds tracked by Insider Monkey, comprising close to $38.2 million in stock, and Ravee Mehta’s Nishkama Capital was right behind this move, as the fund dumped about $8.8 million worth. These moves are interesting, as total hedge fund interest dropped by 3 funds by the end of the third quarter.
Let’s check out hedge fund activity in other stocks similar to Magnite Inc. (NASDAQ:MGNI). These stocks are Commercial Metals Company (NYSE:CMC), Outfront Media Inc (NYSE:OUT), Reata Pharmaceuticals, Inc. (NASDAQ:RETA), Allogene Therapeutics, Inc. (NASDAQ:ALLO), Cerence Inc. (NASDAQ:CRNC), Meritage Homes Corp (NYSE:MTH), and Six Flags Entertainment Corp (NYSE:SIX). This group of stocks’ market values match MGNI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CMC | 19 | 181681 | -3 |
| OUT | 35 | 688851 | 4 |
| RETA | 13 | 184435 | -5 |
| ALLO | 21 | 205580 | -5 |
| CRNC | 18 | 105845 | -3 |
| MTH | 27 | 370507 | 7 |
| SIX | 42 | 1046474 | 6 |
| Average | 25 | 397625 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $398 million. That figure was $217 million in MGNI’s case. Six Flags Entertainment Corp (NYSE:SIX) is the most popular stock in this table. On the other hand Reata Pharmaceuticals, Inc. (NASDAQ:RETA) is the least popular one with only 13 bullish hedge fund positions. Magnite Inc. (NASDAQ:MGNI) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MGNI is 51.3. 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. 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 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 beat the market again by 5.1 percentage points. Unfortunately MGNI wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on MGNI were disappointed as the stock returned -37.2% since the end of September (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 many of these stocks already outperformed the market since 2019.
Follow Magnite Inc. (NASDAQ:MGNI)
Follow Magnite Inc. (NASDAQ:MGNI)
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Disclosure: None. This article was originally published at Insider Monkey.
