Although the masses and most of the financial media blame hedge funds for their exorbitant fee structure and disappointing performance, these investors have proved to have great stock picking abilities over the years (that’s why their assets under management continue to swell). We believe hedge fund sentiment should serve as a crucial tool of an individual investor’s stock selection process, as it may offer great insights of how the brightest minds of the finance industry feel about specific stocks. After all, these people have access to the smartest analysts and expensive data/information sources that individual investors can’t match. So should one consider investing in Matterport Inc. (NASDAQ:MTTR)? The smart money sentiment can provide an answer to this question.
Is Matterport Inc. (NASDAQ:MTTR) a safe investment now? Prominent investors were becoming hopeful. The number of bullish hedge fund positions moved up by 22 lately. Matterport Inc. (NASDAQ:MTTR) was in 22 hedge funds’ portfolios at the end of the third quarter of 2021. Our calculations also showed that MTTR isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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. Keeping this in mind we’re going to take a glance at the new hedge fund action encompassing Matterport Inc. (NASDAQ:MTTR).
Chase Coleman of Tiger Global
Do Hedge Funds Think MTTR Is A Good Stock To Buy Now?
At Q3’s end, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 22 from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards MTTR over the last 25 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Matterport Inc. (NASDAQ:MTTR) was held by Tiger Global Management LLC, which reported holding $141.8 million worth of stock at the end of September. It was followed by Senator Investment Group with a $66.2 million position. Other investors bullish on the company included Miller Value Partners, Southpoint Capital Advisors, and LMR Partners. In terms of the portfolio weights assigned to each position Miller Value Partners allocated the biggest weight to Matterport Inc. (NASDAQ:MTTR) , around 1.53% of its 13F portfolio. Senator Investment Group is also relatively very bullish on the stock, dishing out 1.13 percent of its 13F equity portfolio to MTTR.
Consequently, specific money managers were breaking ground themselves. Tiger Global Management LLC, managed by Chase Coleman, initiated the biggest position in Matterport Inc. (NASDAQ:MTTR) . Tiger Global Management LLC had $141.8 million invested in the company at the end of the quarter. Doug Silverman and Alexander Klabin’s Senator Investment Group also made a $66.2 million investment in the stock during the quarter. The other funds with brand new MTTR positions are Bill Miller’s Miller Value Partners, John Smith Clark’s Southpoint Capital Advisors, and Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners.
Let’s now take a look at hedge fund activity in other stocks similar to Matterport Inc. (NASDAQ:MTTR) . We will take a look at Highwoods Properties Inc (NYSE:HIW), Jamf Holding Corp. (NASDAQ:JAMF), APi Group Corporation (NYSE:APG), Agree Realty Corporation (NYSE:ADC), Armstrong World Industries, Inc. (NYSE:AWI), Selective Insurance Group, Inc. (NASDAQ:SIGI), and RLI Corp. (NYSE:RLI). This group of stocks’ market valuations match MTTR’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HIW | 19 | 100996 | 5 |
| JAMF | 23 | 2301880 | 4 |
| APG | 34 | 1332275 | 0 |
| ADC | 20 | 155884 | 2 |
| AWI | 22 | 480178 | 5 |
| SIGI | 14 | 27641 | 0 |
| RLI | 18 | 192378 | 3 |
| Average | 21.4 | 655890 | 2.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.4 hedge funds with bullish positions and the average amount invested in these stocks was $656 million. That figure was $372 million in MTTR’s case. APi Group Corporation (NYSE:APG) is the most popular stock in this table. On the other hand Selective Insurance Group, Inc. (NASDAQ:SIGI) is the least popular one with only 14 bullish hedge fund positions. Matterport Inc. (NASDAQ:MTTR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MTTR is 42. 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 beat the market by 3.6 percentage points. Hedge funds were also right about betting on MTTR as the stock returned 9.1% since the end of Q3 (through 12/31) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
