The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the first quarter, which unveil their equity positions as of March 31. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards MGM Growth Properties LLC (NYSE:MGP).
Is MGM Growth Properties LLC (NYSE:MGP) a healthy stock for your portfolio? Prominent investors are becoming more confident. The number of long hedge fund bets inched up by 5 lately. Our calculations also showed that mgp isn't among the 30 most popular stocks among hedge funds. MGP was in 17 hedge funds' portfolios at the end of March. There were 12 hedge funds in our database with MGP positions at the end of the previous quarter.
To most market participants, hedge funds are viewed as unimportant, outdated financial tools of the past. While there are over 8000 funds with their doors open at the moment, Our experts look at the moguls of this group, approximately 750 funds. Most estimates calculate that this group of people command bulk of the hedge fund industry's total asset base, and by monitoring their best investments, Insider Monkey has determined a few investment strategies that have historically exceeded the broader indices. Insider Monkey's flagship hedge fund strategy outrun the S&P 500 index by around 5 percentage points per annum since its inception in May 2014 through June 18th. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 28.2% since February 2017 (through June 18th) even though the market was up nearly 30% during the same period. We just shared a list of 5 short targets in our latest quarterly update and they are already down an average of 8.2% in a month whereas our long picks outperformed the market by 2.5 percentage points in this volatile 5 week period (our long picks also beat the market by 15 percentage points so far this year).
[caption id="attachment_747404" align="aligncenter" width="473"] Stuart Zimmer of Zimmer Partners[/caption]
We're going to review the fresh hedge fund action encompassing MGM Growth Properties LLC (NYSE:MGP).
Hedge fund activity in MGM Growth Properties LLC (NYSE:MGP)
At Q1's end, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 42% from the previous quarter. By comparison, 17 hedge funds held shares or bullish call options in MGP a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in MGM Growth Properties LLC (NYSE:MGP) was held by Zimmer Partners, which reported holding $103.2 million worth of stock at the end of March. It was followed by Echo Street Capital Management with a $44.6 million position. Other investors bullish on the company included Millennium Management, Citadel Investment Group, and Renaissance Technologies.
As aggregate interest increased, key hedge funds were breaking ground themselves. Zimmer Partners, managed by Stuart J. Zimmer, created the largest position in MGM Growth Properties LLC (NYSE:MGP). Zimmer Partners had $103.2 million invested in the company at the end of the quarter. Clint Carlson's Carlson Capital also made a $21.2 million investment in the stock during the quarter. The other funds with brand new MGP positions are Jonathan Litt's Land & Buildings Investment Management, Ryan Caldwell's Chiron Investment Management, and David Harding's Winton Capital Management.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as MGM Growth Properties LLC (NYSE:MGP) but similarly valued. These stocks are Juniper Networks, Inc. (NYSE:JNPR), Leidos Holdings Inc (NYSE:LDOS), Qiagen NV (NYSE:QGEN), and Aurora Cannabis Inc. (NYSE:ACB). This group of stocks' market values are closest to MGP's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position JNPR,24,730690,-5 LDOS,21,326471,-5 QGEN,23,375552,2 ACB,11,115927,2 Average,19.75,387160,-1.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.75 hedge funds with bullish positions and the average amount invested in these stocks was $387 million. That figure was $315 million in MGP's case. Juniper Networks, Inc. (NYSE:JNPR) is the most popular stock in this table. On the other hand Aurora Cannabis Inc. (NYSE:ACB) is the least popular one with only 11 bullish hedge fund positions. MGM Growth Properties LLC (NYSE:MGP) is not the least popular stock in this group but hedge fund interest is still below average. 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 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately MGP wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); MGP investors were disappointed as the stock returned -1.2% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.