We at Insider Monkey have gone over 700 13F filings that hedge funds and prominent 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 funds think of The Macerich Company (NYSE:MAC) based on that data.
The Macerich Company (NYSE:MAC) investors should be aware of a decrease in support from the world’s most elite money managers recently. MAC was in 30 hedge funds’ portfolios at the end of the third quarter of 2018. There were 38 hedge funds in our database with MAC holdings at the end of the previous quarter. Our calculations also showed that MAC isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 24% through December 3, 2018. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We’re going to take a look at the fresh hedge fund action encompassing The Macerich Company (NYSE:MAC).
What does the smart money think about The Macerich Company (NYSE:MAC)?
Heading into the fourth quarter of 2018, a total of 30 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -21% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards MAC over the last 13 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 The Macerich Company (NYSE:MAC) was held by Third Avenue Management, which reported holding $87.7 million worth of stock at the end of September. It was followed by Balyasny Asset Management with a $52 million position. Other investors bullish on the company included Citadel Investment Group, Ulysses Management, and Ulysses Management.
Since The Macerich Company (NYSE:MAC) has witnessed a decline in interest from the smart money, it’s safe to say that there were a few hedgies that elected to cut their entire stakes in the third quarter. Interestingly, Jeffrey Smith’s Starboard Value LP said goodbye to the largest investment of all the hedgies tracked by Insider Monkey, worth an estimated $65.4 million in stock. Howard Guberman’s fund, Gruss Asset Management, also dumped its stock, about $32.7 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 8 funds in the third quarter.
Let’s also examine hedge fund activity in other stocks similar to The Macerich Company (NYSE:MAC). We will take a look at Brookfield Property Partners LP (NYSE:BPY), Black Knight, Inc. (NYSE:BKI), Wheaton Precious Metals Corp. (NYSE:WPM), and Graco Inc. (NYSE:GGG). All of these stocks’ market caps are closest to MAC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BPY | 11 | 136100 | 8 |
| BKI | 36 | 592526 | 4 |
| WPM | 22 | 264281 | 6 |
| GGG | 22 | 219077 | 6 |
| Average | 22.75 | 302996 | 6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 22.75 hedge funds with bullish positions and the average amount invested in these stocks was $303 million. That figure was $409 million in MAC’s case. Black Knight, Inc. (NYSE:BKI) is the most popular stock in this table. On the other hand Brookfield Property Partners LP (NYSE:BPY) is the least popular one with only 11 bullish hedge fund positions. The Macerich Company (NYSE:MAC) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard BKI might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.
