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Is MANH Stock A Buy or Sell?

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In this article we will check out the progression of hedge fund sentiment towards Manhattan Associates, Inc. (NASDAQ:MANH) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.

Is MANH stock a buy? Manhattan Associates, Inc. (NASDAQ:MANH) investors should be aware of an increase in support from the world's most elite money managers lately. Manhattan Associates, Inc. (NASDAQ:MANH) was in 23 hedge funds' portfolios at the end of December. The all time high for this statistic is 25. Our calculations also showed that MANH isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).

In the 21st century investor’s toolkit there are a multitude of signals market participants use to assess their stock investments. Two of the most under-the-radar signals are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the top picks of the best money managers can outpace the market by a very impressive margin (see the details here). Also, our monthly newsletter's portfolio of long stock picks returned 197% since March 2017 (through March 2021) and beat the S&P 500 Index by 124 percentage points. You can download a sample issue of this newsletter on our website .

Noam Gottesman GLG Partners
Noam Gottesman GLG Partners

Noam Gottesman of GLG Partners

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, auto parts business is a recession resistant business, so we are taking a closer look at this discount auto parts stock that is growing at a 196% annualized rate. We go through lists like the 15 best micro-cap stocks to buy now to identify the next stock with 10x upside potential. 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 website. Keeping this in mind we're going to go over the latest hedge fund action surrounding Manhattan Associates, Inc. (NASDAQ:MANH).

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

At the end of the fourth quarter, a total of 23 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 5% from one quarter earlier. On the other hand, there were a total of 24 hedge funds with a bullish position in MANH a year ago. With the smart money's capital changing hands, there exists an "upper tier" of key hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).

Among these funds, RGM Capital held the most valuable stake in Manhattan Associates, Inc. (NASDAQ:MANH), which was worth $83.7 million at the end of the fourth quarter. On the second spot was Royce & Associates which amassed $70 million worth of shares. Renaissance Technologies, Shannon River Fund Management, and GLG Partners 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 RGM Capital allocated the biggest weight to Manhattan Associates, Inc. (NASDAQ:MANH), around 3.65% of its 13F portfolio. Shannon River Fund Management is also relatively very bullish on the stock, setting aside 1.74 percent of its 13F equity portfolio to MANH.

As aggregate interest increased, key money managers have been driving this bullishness. Columbus Circle Investors, managed by Principal Global Investors, established the most outsized position in Manhattan Associates, Inc. (NASDAQ:MANH). Columbus Circle Investors had $11.6 million invested in the company at the end of the quarter. Dmitry Balyasny's Balyasny Asset Management also initiated a $5.3 million position during the quarter. The following funds were also among the new MANH investors: Ryan Tolkin (CIO)'s Schonfeld Strategic Advisors, D. E. Shaw's D E Shaw, and Matthew Hulsizer's PEAK6 Capital Management.

Let's check out hedge fund activity in other stocks similar to Manhattan Associates, Inc. (NASDAQ:MANH). We will take a look at PVH Corp (NYSE:PVH), Post Holdings Inc (NYSE:POST), ITT Inc. (NYSE:ITT), Futu Holdings Limited (NASDAQ:FUTU), Kilroy Realty Corp (NYSE:KRC), Casey's General Stores, Inc. (NASDAQ:CASY), and Ballard Power Systems Inc. (NASDAQ:BLDP). This group of stocks' market values are closest to MANH's market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PVH,37,1132304,9 POST,27,1536661,-3 ITT,28,406807,-2 FUTU,17,334170,2 KRC,25,251572,6 CASY,23,120810,2 BLDP,20,200727,-1 Average,25.3,569007,1.9 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 25.3 hedge funds with bullish positions and the average amount invested in these stocks was $569 million. That figure was $288 million in MANH's case. PVH Corp (NYSE:PVH) is the most popular stock in this table. On the other hand Futu Holdings Limited (NASDAQ:FUTU) is the least popular one with only 17 bullish hedge fund positions. Manhattan Associates, Inc. (NASDAQ:MANH) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MANH is 48.6. 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 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. A small number of hedge funds were also right about betting on MANH as the stock returned 16.1% since the end of the fourth quarter (through 4/19) and outperformed the market by an even larger margin.

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

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