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. We at Insider Monkey have plowed through 867 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. Hedge funds’ consensus stock picks performed spectacularly over the last 3 years, but 2022 hasn’t been kind to hedge funds. In this article we look at how hedge funds traded Marvell Technology Group Ltd. (NASDAQ:MRVL) and determine whether the smart money was really smart about this stock.
Is Marvell Technology Group Ltd. (NASDAQ:MRVL) a buy here? Money managers were becoming less confident. The number of long hedge fund bets fell by 6 lately. Marvell Technology Group Ltd. (NASDAQ:MRVL) was in 45 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 51. Our calculations also showed that MRVL isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 51 hedge funds in our database with MRVL positions at the end of the second quarter.
Matthew Hulsizer of PEAK6 Capital
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 let’s take a gander at the latest hedge fund action encompassing Marvell Technology Group Ltd. (NASDAQ:MRVL).
Do Hedge Funds Think MRVL Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 45 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -12% from the second quarter of 2021. On the other hand, there were a total of 37 hedge funds with a bullish position in MRVL a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Polar Capital held the most valuable stake in Marvell Technology Group Ltd. (NASDAQ:MRVL), which was worth $252 million at the end of the third quarter. On the second spot was Holocene Advisors which amassed $155.1 million worth of shares. Citadel Investment Group, Jericho Capital Asset Management, and Citadel Investment Group were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Totem Point Management allocated the biggest weight to Marvell Technology Group Ltd. (NASDAQ:MRVL), around 7.97% of its 13F portfolio. Boardman Bay Capital Management is also relatively very bullish on the stock, designating 6.05 percent of its 13F equity portfolio to MRVL.
Seeing as Marvell Technology Group Ltd. (NASDAQ:MRVL) has faced a decline in interest from hedge fund managers, it’s safe to say that there was a specific group of fund managers that slashed their full holdings heading into Q4. It’s worth mentioning that Seymour Sy Kaufman and Michael Stark’s Crosslink Capital dropped the largest stake of the “upper crust” of funds followed by Insider Monkey, valued at about $26.2 million in call options, and Rob Citrone’s Discovery Capital Management was right behind this move, as the fund cut about $11.3 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest fell by 6 funds heading into Q4.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Marvell Technology Group Ltd. (NASDAQ:MRVL) but similarly valued. These stocks are Dollar General Corp. (NYSE:DG), Banco Santander (Brasil) SA (NYSE:BSBR), Johnson Controls International plc (NYSE:JCI), Keurig Dr Pepper Inc. (NASDAQ:KDP), Coupang, Inc. (NYSE:CPNG), Wipro Limited (NYSE:WIT), and Marriott International Inc (NYSE:MAR). This group of stocks’ market values are similar to MRVL’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DG | 46 | 1905639 | 1 |
| BSBR | 8 | 10442 | 1 |
| JCI | 45 | 1031579 | 6 |
| KDP | 33 | 1269519 | 5 |
| CPNG | 45 | 10769505 | 12 |
| WIT | 15 | 183023 | 1 |
| MAR | 39 | 2878858 | -10 |
| Average | 33 | 2578366 | 2.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 33 hedge funds with bullish positions and the average amount invested in these stocks was $2578 million. That figure was $1153 million in MRVL’s case. Dollar General Corp. (NYSE:DG) is the most popular stock in this table. On the other hand Banco Santander (Brasil) SA (NYSE:BSBR) is the least popular one with only 8 bullish hedge fund positions. Marvell Technology Group Ltd. (NASDAQ:MRVL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MRVL is 74.2. 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 MRVL as the stock returned 18.6% since the end of Q3 (through 1/31) 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.
