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. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. In this article we are going to take a look at smart money sentiment towards Medallion Financial Corp. (NASDAQ:MFIN).
Medallion Financial Corp. (NASDAQ:MFIN) has seen a decrease in enthusiasm from smart money in recent months. Our calculations also showed that MFIN isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the 21st century investor’s toolkit there are plenty of signals stock market investors employ to analyze publicly traded companies. A duo of the less known signals are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best investment managers can outclass the S&P 500 by a healthy amount (see the details here).
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to take a peek at the recent hedge fund action surrounding Medallion Financial Corp. (NASDAQ:MFIN).
How have hedgies been trading Medallion Financial Corp. (NASDAQ:MFIN)?
Heading into the second quarter of 2020, a total of 4 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -20% from the previous quarter. The graph below displays the number of hedge funds with bullish position in MFIN over the last 18 quarters. With hedge funds’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Alex Lieblong’s Key Colony Management has the largest position in Medallion Financial Corp. (NASDAQ:MFIN), worth close to $2.5 million, comprising 6.4% of its total 13F portfolio. Sitting at the No. 2 spot is GAMCO Investors, managed by Mario Gabelli, which holds a $0.4 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers with similar optimism comprise David Harding’s Winton Capital Management, Israel Englander’s Millennium Management and . In terms of the portfolio weights assigned to each position Key Colony Management allocated the biggest weight to Medallion Financial Corp. (NASDAQ:MFIN), around 6.4% of its 13F portfolio. GAMCO Investors is also relatively very bullish on the stock, setting aside 0.01 percent of its 13F equity portfolio to MFIN.
Judging by the fact that Medallion Financial Corp. (NASDAQ:MFIN) has faced bearish sentiment from the smart money, it’s safe to say that there is a sect of hedge funds who were dropping their full holdings last quarter. Intriguingly, Ken Griffin’s Citadel Investment Group cut the largest position of the 750 funds tracked by Insider Monkey, worth about $0.2 million in stock, and Peter Muller’s PDT Partners was right behind this move, as the fund sold off about $0.1 million worth. These moves are interesting, as total hedge fund interest was cut by 1 funds last quarter.
Let’s check out hedge fund activity in other stocks similar to Medallion Financial Corp. (NASDAQ:MFIN). These stocks are Great Elm Capital Group, Inc. (NASDAQ:GEC), Dover Motorsports, Inc. (NYSE:DVD), Vince Holding Corp (NYSE:VNCE), and Blink Charging Co. (NASDAQ:BLNK). All of these stocks’ market caps are similar to MFIN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GEC | 7 | 15496 | -1 |
| DVD | 5 | 4589 | 0 |
| VNCE | 5 | 1773 | -2 |
| BLNK | 3 | 334 | 0 |
| Average | 5 | 5548 | -0.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5 hedge funds with bullish positions and the average amount invested in these stocks was $6 million. That figure was $3 million in MFIN’s case. Great Elm Capital Group, Inc. (NASDAQ:GEC) is the most popular stock in this table. On the other hand Blink Charging Co. (NASDAQ:BLNK) is the least popular one with only 3 bullish hedge fund positions. Medallion Financial Corp. (NASDAQ:MFIN) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. A small number of hedge funds were also right about betting on MFIN as the stock returned 25.3% during the second quarter and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
