Is Momentive Global Inc (MNTV) Going to Burn These Hedge Funds?

·5 min read

With the second-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the third quarter of 2021. One of these stocks was Momentive Global Inc (NASDAQ:MNTV).

Momentive Global Inc (NASDAQ:MNTV) has experienced a decrease in support from the world's most elite money managers lately. Momentive Global Inc (NASDAQ:MNTV) was in 28 hedge funds' portfolios at the end of June. The all time high for this statistic is 33. Our calculations also showed that MNTV isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Chase Coleman of Tiger Global

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

Heading into the third quarter of 2021, a total of 28 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from the first quarter of 2020. By comparison, 33 hedge funds held shares or bullish call options in MNTV a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists an "upper tier" of noteworthy hedge fund managers who were upping their stakes substantially (or already accumulated large positions).

Is MNTV A Good Stock To Buy?
Is MNTV A Good Stock To Buy?

More specifically, Park West Asset Management was the largest shareholder of Momentive Global Inc (NASDAQ:MNTV), with a stake worth $41.7 million reported as of the end of June. Trailing Park West Asset Management was Legion Partners Asset Management, which amassed a stake valued at $39.8 million. ThornTree Capital Partners, Cannell Capital, and Tiger Global Management LLC 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 Legion Partners Asset Management allocated the biggest weight to Momentive Global Inc (NASDAQ:MNTV), around 7.99% of its 13F portfolio. Akaris Global Partners is also relatively very bullish on the stock, setting aside 6.84 percent of its 13F equity portfolio to MNTV.

Due to the fact that Momentive Global Inc (NASDAQ:MNTV) has faced falling interest from hedge fund managers, it's easy to see that there exists a select few funds who were dropping their positions entirely in the second quarter. Interestingly, Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital cut the largest investment of the "upper crust" of funds tracked by Insider Monkey, totaling close to $6.7 million in stock, and Paul Tudor Jones's Tudor Investment Corp was right behind this move, as the fund said goodbye to about $4.3 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest fell by 4 funds in the second quarter.

Let's check out hedge fund activity in other stocks similar to Momentive Global Inc (NASDAQ:MNTV). We will take a look at 8x8, Inc. (NASDAQ:EGHT), NorthWestern Corporation (NYSE:NWE), Azul S.A. (NYSE:AZUL), American Well Corporation (NYSE:AMWL), Werner Enterprises, Inc. (NASDAQ:WERN), Skyline Champion Corporation (NYSE:SKY), and CNX Resources Corporation (NYSE:CNX). This group of stocks' market values are similar to MNTV's market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EGHT,29,928021,5 NWE,15,56305,4 AZUL,10,120056,-1 AMWL,20,124952,1 WERN,20,203288,-1 SKY,23,353727,0 CNX,30,539926,7 Average,21,332325,2.1 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $332 million. That figure was $239 million in MNTV's case. CNX Resources Corporation (NYSE:CNX) is the most popular stock in this table. On the other hand Azul S.A. (NYSE:AZUL) is the least popular one with only 10 bullish hedge fund positions. Momentive Global Inc (NASDAQ:MNTV) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MNTV is 71.5. 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. Hedge funds were also right about betting on MNTV as the stock returned 16.7% since the end of Q2 (through 10/15) 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.

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