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 821 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 March 31st, a week after the market trough. We are almost done with the second quarter. Investors decided to bet on the economic recovery and a stock market rebound. S&P 500 Index returned almost 20% this quarter. In this article we look at how hedge funds traded Match Group, Inc. (NASDAQ:MTCH) and determine whether the smart money was really smart about this stock.
Is Match Group, Inc. (NASDAQ:MTCH) a healthy stock for your portfolio? Investors who are in the know were betting on the stock. The number of long hedge fund bets rose by 6 recently. Our calculations also showed that MTCH 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). MTCH was in 38 hedge funds' portfolios at the end of March. There were 32 hedge funds in our database with MTCH holdings at the end of the previous quarter. Video: Watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are many tools market participants use to grade stocks. A pair of the most useful tools are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the best picks of the top hedge fund managers can outpace the market by a superb margin (see the details here).
[caption id="attachment_26575" align="aligncenter" width="400"] Louis Bacon Moore of Moore Capital[/caption]
At Insider Monkey we scour multiple sources to uncover the next great investment idea. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Hedge fund sentiment towards Tesla reached its all time high at the end of 2019 and Tesla shares more than tripled this year. We are trying to identify other EV revolution winners, so we are checking out this tiny lithium stock. With all of this in mind we're going to review the new hedge fund action regarding Match Group, Inc. (NASDAQ:MTCH).
How have hedgies been trading Match Group, Inc. (NASDAQ:MTCH)?
At Q1's end, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of 19% from the previous quarter. The graph below displays the number of hedge funds with bullish position in MTCH over the last 18 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Lone Pine Capital held the most valuable stake in Match Group, Inc. (NASDAQ:MTCH), which was worth $452.1 million at the end of the third quarter. On the second spot was Egerton Capital Limited which amassed $170.3 million worth of shares. Antara Capital, SRS Investment Management, and Light Street Capital 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 Portsea Asset Management allocated the biggest weight to Match Group, Inc. (NASDAQ:MTCH), around 27.11% of its 13F portfolio. Axel Capital Management is also relatively very bullish on the stock, dishing out 4.91 percent of its 13F equity portfolio to MTCH.
As one would reasonably expect, specific money managers have been driving this bullishness. SRS Investment Management, managed by Karthik Sarma, initiated the biggest position in Match Group, Inc. (NASDAQ:MTCH). SRS Investment Management had $81 million invested in the company at the end of the quarter. Cyrus de Weck's Portsea Asset Management also initiated a $30.1 million position during the quarter. The other funds with brand new MTCH positions are Robert Pitts's Steadfast Capital Management, John Smith Clark's Southpoint Capital Advisors, and Keith Meister's Corvex Capital.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Match Group, Inc. (NASDAQ:MTCH) but similarly valued. We will take a look at Fortive Corporation (NYSE:FTV), Cadence Design Systems Inc (NASDAQ:CDNS), Valero Energy Corporation (NYSE:VLO), and RingCentral Inc (NYSE:RNG). This group of stocks' market caps are similar to MTCH's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FTV,35,1015089,-8 CDNS,31,1339958,-11 VLO,45,275743,-1 RNG,67,2827940,5 Average,44.5,1364683,-3.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 44.5 hedge funds with bullish positions and the average amount invested in these stocks was $1365 million. That figure was $1033 million in MTCH's case. RingCentral Inc (NYSE:RNG) is the most popular stock in this table. On the other hand Cadence Design Systems Inc (NASDAQ:CDNS) is the least popular one with only 31 bullish hedge fund positions. Match Group, Inc. (NASDAQ:MTCH) 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 12.3% in 2020 through June 30th and still beat the market by 15.5 percentage points. A small number of hedge funds were also right about betting on MTCH as the stock returned 39.8% 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.