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Hedge Funds Are Cashing Out Of Marvell Technology Group Ltd. (MRVL)

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  • MRVL

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 have processed the filings of the more than 867 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30th holdings, data that is available nowhere else. Should you consider Marvell Technology Group Ltd. (NASDAQ:MRVL) for your portfolio? We'll look to this invaluable collective wisdom for the answer.

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. MRVL has seen a decrease in hedge fund sentiment of late. There were 51 hedge funds in our database with MRVL holdings at the end of June. Our calculations also showed that MRVL isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings).

Matthew Hulsizer PEAK6 Capital
Matthew Hulsizer PEAK6 Capital

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. With all of this in mind we're going to take a peek at the fresh hedge fund action encompassing Marvell Technology Group Ltd. (NASDAQ:MRVL).

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

At Q3's end, 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 check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is MRVL A Good Stock To Buy?
Is MRVL A Good Stock To Buy?

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 the smart money, we can see that there lies a certain "tier" of fund managers that elected to cut their full holdings heading into Q4. It's worth mentioning that Seymour Sy Kaufman and Michael Stark's Crosslink Capital dumped the biggest investment of all the hedgies followed by Insider Monkey, worth an estimated $26.2 million in call options. Rob Citrone's fund, Discovery Capital Management, also dropped its call options, about $11.3 million worth. These moves are important to note, as aggregate hedge fund interest fell by 6 funds heading into Q4.

Let's go over 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 caps are closest to MRVL's market cap.

[table] 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 [/table]

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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on MRVL as the stock returned 18.1% since the end of Q3 (through 11/30) 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.