After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of March 31st. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards ArcelorMittal (NYSE:MT).
Is ArcelorMittal (NYSE:MT) a splendid investment right now? The best stock pickers were turning bullish. The number of long hedge fund bets went up by 3 lately. ArcelorMittal (NYSE:MT) was in 21 hedge funds’ portfolios at the end of March. The all time high for this statistic is 25. Our calculations also showed that MT isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 18 hedge funds in our database with MT positions at the end of the fourth quarter.
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Do Hedge Funds Think MT Is A Good Stock To Buy Now?
At first quarter’s end, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 17% from the fourth quarter of 2020. By comparison, 13 hedge funds held shares or bullish call options in MT a year ago. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
The largest stake in ArcelorMittal (NYSE:MT) was held by GQG Partners, which reported holding $362 million worth of stock at the end of December. It was followed by Citadel Investment Group with a $60.3 million position. Other investors bullish on the company included Millennium Management, Scopus Asset Management, and Castle Hook Partners. In terms of the portfolio weights assigned to each position Highline Capital Management allocated the biggest weight to ArcelorMittal (NYSE:MT), around 4.18% of its 13F portfolio. Maple Rock Capital is also relatively very bullish on the stock, setting aside 4.15 percent of its 13F equity portfolio to MT.
With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. GQG Partners, managed by Rajiv Jain, initiated the biggest position in ArcelorMittal (NYSE:MT). GQG Partners had $362 million invested in the company at the end of the quarter. Josh Donfeld and David Rogers’s Castle Hook Partners also initiated a $38.4 million position during the quarter. The other funds with brand new MT positions are Len Kipp and Xavier Majic’s Maple Rock Capital, Steve Cohen’s Point72 Asset Management, and Jacob Doft’s Highline Capital Management.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as ArcelorMittal (NYSE:MT) but similarly valued. We will take a look at Palo Alto Networks Inc (NYSE:PANW), V.F. Corporation (NYSE:VFC), NatWest Group plc (NYSE:NWG), McKesson Corporation (NYSE:MCK), AutoZone, Inc. (NYSE:AZO), The Trade Desk, Inc. (NASDAQ:TTD), and Rockwell Automation Inc. (NYSE:ROK). This group of stocks’ market valuations resemble MT’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PANW | 64 | 4015196 | 3 |
| VFC | 31 | 1109135 | 0 |
| NWG | 6 | 4359 | 3 |
| MCK | 51 | 2123043 | 0 |
| AZO | 34 | 754312 | -10 |
| TTD | 35 | 812891 | 0 |
| ROK | 26 | 442334 | -9 |
| Average | 35.3 | 1323039 | -1.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 35.3 hedge funds with bullish positions and the average amount invested in these stocks was $1323 million. That figure was $710 million in MT’s case. Palo Alto Networks Inc (NYSE:PANW) is the most popular stock in this table. On the other hand NatWest Group plc (NYSE:NWG) is the least popular one with only 6 bullish hedge fund positions. ArcelorMittal (NYSE:MT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MT is 46.1. 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 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately MT wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); MT investors were disappointed as the stock returned 2.1% since the end of March (through 7/16) 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.
Follow Arcelormittal S A Luxembourg (NYSE:MT)
Follow Arcelormittal S A Luxembourg (NYSE:MT)
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Disclosure: None. This article was originally published at Insider Monkey.
