We at Insider Monkey have gone over 873 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 June 30th. In this article, we look at what those funds think of 3M Company (NYSE:MMM) based on that data.
3M Company (NYSE:MMM) shareholders have witnessed an increase in hedge fund interest of late. 3M Company (NYSE:MMM) was in 42 hedge funds’ portfolios at the end of June. The all time high for this statistic is 56. There were 41 hedge funds in our database with MMM holdings at the end of March. Our calculations also showed that MMM isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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Ryan Tolkin, CIO of Schonfeld Strategic Advisors
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Do Hedge Funds Think MMM Is A Good Stock To Buy Now?
At the end of June, a total of 42 of the hedge funds tracked by Insider Monkey were long this stock, a change of 2% from the previous quarter. By comparison, 42 hedge funds held shares or bullish call options in MMM a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in 3M Company (NYSE:MMM) was held by Fisher Asset Management, which reported holding $1071.2 million worth of stock at the end of June. It was followed by AQR Capital Management with a $235.5 million position. Other investors bullish on the company included Citadel Investment Group, Citadel Investment Group, and D E Shaw. In terms of the portfolio weights assigned to each position Hourglass Capital allocated the biggest weight to 3M Company (NYSE:MMM), around 1.27% of its 13F portfolio. Arjuna Capital is also relatively very bullish on the stock, earmarking 0.88 percent of its 13F equity portfolio to MMM.
Now, key money managers have been driving this bullishness. Centiva Capital, managed by Karim Abbadi and Edward McBride, initiated the most outsized position in 3M Company (NYSE:MMM). Centiva Capital had $3 million invested in the company at the end of the quarter. Gregg Moskowitz’s Interval Partners also initiated a $3 million position during the quarter. The other funds with new positions in the stock are Karim Abbadi and Edward McBride’s Centiva Capital, Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors, and David Costen Haley’s HBK Investments.
Let’s now take a look at hedge fund activity in other stocks similar to 3M Company (NYSE:MMM). We will take a look at Advanced Micro Devices, Inc. (NASDAQ:AMD), Zoom Video Communications, Inc. (NASDAQ:ZM), Diageo plc (NYSE:DEO), Square, Inc. (NYSE:SQ), Deere & Company (NYSE:DE), CVS Health Corporation (NYSE:CVS), and Intuitive Surgical, Inc. (NASDAQ:ISRG). This group of stocks’ market valuations match MMM’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AMD | 63 | 4610011 | 1 |
| ZM | 59 | 8480712 | 5 |
| DEO | 20 | 891081 | -2 |
| SQ | 94 | 10327761 | 2 |
| DE | 52 | 2173962 | 1 |
| CVS | 67 | 1355477 | 5 |
| ISRG | 60 | 3475820 | 7 |
| Average | 59.3 | 4473546 | 2.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 59.3 hedge funds with bullish positions and the average amount invested in these stocks was $4474 million. That figure was $1583 million in MMM’s case. Square, Inc. (NYSE:SQ) is the most popular stock in this table. On the other hand Diageo plc (NYSE:DEO) is the least popular one with only 20 bullish hedge fund positions. 3M Company (NYSE:MMM) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MMM is 43.4. 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 29.6% in 2021 through November 5th and surpassed the market again by 3.1 percentage points. Unfortunately MMM wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); MMM investors were disappointed as the stock returned -7.8% since the end of June (through 11/5) 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.
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Disclosure: None. This article was originally published at Insider Monkey.
