Are Hedge Funds Right About MGM Resorts International (MGM)?

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Because MGM Resorts International (NYSE:MGM) has faced declining sentiment from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of money managers that decided to sell off their entire stakes in the third quarter. Intriguingly, Ken Griffin’s Citadel Investment Group said goodbye to the largest position of the 700 funds monitored by Insider Monkey, comprising close to $14.8 million in call options, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund dropped about $9.1 million worth of shares. These transactions are important to note, as total hedge fund interest dropped by 6 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as MGM Resorts International (NYSE:MGM) but similarly valued. These stocks are Marathon Oil Corporation (NYSE:MRO), National-Oilwell Varco, Inc. (NYSE:NOV), Macerich Co (NYSE:MAC), and Nomura Holdings, Inc. (ADR) (NYSE:NMR). This group of stocks’ market caps are similar to MGM’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MRO 22 213779 -4
NOV 25 329212 1
MAC 19 272669 -1
NMR 3 5817 -3

As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $205 million. That figure was $2.30 billion in MGM’s case. National-Oilwell Varco, Inc. (NYSE:NOV) is the most popular stock in this table. On the other hand Nomura Holdings, Inc. (ADR) (NYSE:NMR) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks MGM Resorts International (NYSE:MGM) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers and have a lot of money invested in it, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

Disclosure: None

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