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Fortive Corporation (FTV): Hedge Funds Are Coming Back

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Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Fortive Corporation (NYSE:FTV) in this article.

Is Fortive Corporation (NYSE:FTV) a healthy stock for your portfolio? Prominent investors were betting on the stock. The number of bullish hedge fund bets advanced by 4 lately. Fortive Corporation (NYSE:FTV) was in 31 hedge funds' portfolios at the end of June. The all time high for this statistic is 46. Our calculations also showed that FTV isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 27 hedge funds in our database with FTV positions at the end of the first quarter.

If you'd ask most traders, hedge funds are perceived as underperforming, outdated financial tools of years past. While there are greater than 8000 funds trading at present, Our researchers choose to focus on the moguls of this group, approximately 850 funds. Most estimates calculate that this group of people command bulk of the smart money's total capital, and by keeping an eye on their top investments, Insider Monkey has revealed numerous investment strategies that have historically outperformed the broader indices. Insider Monkey's flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. Also, our monthly newsletter's portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.

Daniel Sundheim D1 Capital
Daniel Sundheim D1 Capital

Daniel Sundheim of D1 Capital

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. With all of this in mind we're going to check out the key hedge fund action regarding Fortive Corporation (NYSE:FTV).

Do Hedge Funds Think FTV Is A Good Stock To Buy Now?

At the end of the second quarter, a total of 31 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 15% from the previous quarter. On the other hand, there were a total of 35 hedge funds with a bullish position in FTV 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, Viking Global held the most valuable stake in Fortive Corporation (NYSE:FTV), which was worth $821.4 million at the end of the second quarter. On the second spot was Adage Capital Management which amassed $218.5 million worth of shares. Select Equity Group, Citadel Investment Group, and Balyasny Asset Management 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 Viking Global allocated the biggest weight to Fortive Corporation (NYSE:FTV), around 2.49% of its 13F portfolio. Alyeska Investment Group is also relatively very bullish on the stock, earmarking 0.86 percent of its 13F equity portfolio to FTV.

With a general bullishness amongst the heavyweights, some big names have been driving this bullishness. Balyasny Asset Management, managed by Dmitry Balyasny, established the largest position in Fortive Corporation (NYSE:FTV). Balyasny Asset Management had $153.5 million invested in the company at the end of the quarter. Daniel S. Och's OZ Management also made a $96.5 million investment in the stock during the quarter. The other funds with brand new FTV positions are Daniel Sundheim's D1 Capital Partners, Anand Parekh's Alyeska Investment Group, and Greg Poole's Echo Street Capital Management.

Let's now review hedge fund activity in other stocks similar to Fortive Corporation (NYSE:FTV). These stocks are McCormick & Company, Incorporated (NYSE:MKC), Cerner Corporation (NASDAQ:CERN), United Microelectronics Corp (NYSE:UMC), POSCO (NYSE:PKX), Vulcan Materials Company (NYSE:VMC), United Rentals, Inc. (NYSE:URI), and Dollar Tree, Inc. (NASDAQ:DLTR). This group of stocks' market values match FTV's market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position MKC,34,2032436,-1 CERN,38,1394559,-2 UMC,10,141218,-1 PKX,12,161569,0 VMC,43,1374916,-5 URI,47,1173038,6 DLTR,42,1379674,1 Average,32.3,1093916,-0.3 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 32.3 hedge funds with bullish positions and the average amount invested in these stocks was $1094 million. That figure was $2235 million in FTV's case. United Rentals, Inc. (NYSE:URI) is the most popular stock in this table. On the other hand United Microelectronics Corp (NYSE:UMC) is the least popular one with only 10 bullish hedge fund positions. Fortive Corporation (NYSE:FTV) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for FTV is 57.6. 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 24.9% in 2021 through October 15th and still beat the market by 4.5 percentage points. A small number of hedge funds were also right about betting on FTV as the stock returned 4.3% since the end of the second quarter (through 10/15) and outperformed the market by an even larger margin.

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Disclosure: None. This article was originally published at Insider Monkey.