Is Marriott International Inc (MAR) A Good Stock To Buy?

While the market driven by short-term sentiment influenced by the accommodative interest rate environment in the US, virus news and stimulus spending, many smart money investors are starting to get cautious towards the current bull run since March, 2020 and hedging or reducing many of their long positions. Some fund managers are betting on Dow hitting 40,000 to generate strong returns. However, as we know, big investors usually buy stocks with strong fundamentals that can deliver gains both in bull and bear markets, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding Marriott International Inc (NASDAQ:MAR).

Is Marriott International Inc (MAR) a good stock to buy now? Prominent investors were getting less optimistic. The number of bullish hedge fund bets decreased by 10 lately. Marriott International Inc (NASDAQ:MAR) was in 39 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 58. Our calculations also showed that MAR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 49 hedge funds in our database with MAR holdings at the end of June.

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 new hedge fund action regarding Marriott International Inc (NASDAQ:MAR).

Boykin Curry of Eagle Capital

Do Hedge Funds Think MAR Is A Good Stock To Buy Now?

At third quarter’s end, a total of 39 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -20% from the second quarter of 2021. On the other hand, there were a total of 56 hedge funds with a bullish position in MAR a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, Boykin Curry’s Eagle Capital Management has the number one position in Marriott International Inc (NASDAQ:MAR), worth close to $1.4214 billion, comprising 4.2% of its total 13F portfolio. Sitting at the No. 2 spot is Melvin Capital Management, managed by Gabriel Plotkin, which holds a $325.8 million position; 1.7% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors with similar optimism consist of Martin Taylor’s Crake Asset Management, and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Broad Peak Investment Holdings allocated the biggest weight to Marriott International Inc (NASDAQ:MAR), around 21.32% of its 13F portfolio. Crake Asset Management is also relatively very bullish on the stock, dishing out 11.2 percent of its 13F equity portfolio to MAR.

Judging by the fact that Marriott International Inc (NASDAQ:MAR) has experienced bearish sentiment from hedge fund managers, we can see that there was a specific group of hedge funds who were dropping their full holdings in the third quarter. At the top of the heap, Gaurav Kapadia’s XN Exponent Advisors dropped the largest position of the 750 funds tracked by Insider Monkey, worth an estimated $122.9 million in stock. Terry Smith’s fund, Fundsmith LLP, also dropped its stock, about $40.6 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 10 funds in the third quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Marriott International Inc (NASDAQ:MAR) but similarly valued. These stocks are Twitter Inc (NYSE:TWTR), Sumitomo Mitsui Financial Grp, Inc. (NYSE:SMFG), Coinbase Global Inc. (NASDAQ:COIN), Eni SpA (NYSE:E), Freeport-McMoRan Inc. (NYSE:FCX), Fortinet Inc (NASDAQ:FTNT), and Agilent Technologies Inc. (NYSE:A). All of these stocks’ market caps match MAR’s market cap.

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As you can see these stocks had an average of 44 hedge funds with bullish positions and the average amount invested in these stocks was $2413 million. That figure was $2879 million in MAR’s case. Twitter Inc (NYSE:TWTR) is the most popular stock in this table. On the other hand Eni SpA (NYSE:E) is the least popular one with only 3 bullish hedge fund positions. Marriott International Inc (NASDAQ:MAR) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MAR is 35. 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 negative signal and 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 28.6% in 2021 through November 30th and surpassed the market again by 5.6 percentage points. Unfortunately MAR wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); MAR investors were disappointed as the stock returned -0.4% since the end of September (through 11/30) 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 in 2021.

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Disclosure: None. This article was originally published at Insider Monkey.