Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Manpowergroup Inc (NYSE:MAN).
Is Manpowergroup Inc (NYSE:MAN) a healthy stock for your portfolio? Money managers were getting more optimistic. The number of bullish hedge fund bets went up by 1 in recent months. Manpowergroup Inc (NYSE:MAN) was in 27 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 34. Our calculations also showed that MAN isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 26 hedge funds in our database with MAN positions at the end of the first quarter.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 homepage. Now let’s analyze the key hedge fund action surrounding Manpowergroup Inc (NYSE:MAN).
Do Hedge Funds Think MAN Is A Good Stock To Buy Now?
At second quarter’s end, a total of 27 of the hedge funds tracked by Insider Monkey were long this stock, a change of 4% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards MAN over the last 24 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, holds the number one position in Manpowergroup Inc (NYSE:MAN). Arrowstreet Capital has a $93.9 million position in the stock, comprising 0.1% of its 13F portfolio. On Arrowstreet Capital’s heels is AQR Capital Management, led by Cliff Asness, holding a $60.8 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other members of the smart money with similar optimism contain Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group and Renaissance Technologies. In terms of the portfolio weights assigned to each position Arjuna Capital allocated the biggest weight to Manpowergroup Inc (NYSE:MAN), around 0.74% of its 13F portfolio. Quantinno Capital is also relatively very bullish on the stock, dishing out 0.43 percent of its 13F equity portfolio to MAN.
As industrywide interest jumped, key hedge funds have been driving this bullishness. D E Shaw, managed by D. E. Shaw, created the largest call position in Manpowergroup Inc (NYSE:MAN). D E Shaw had $2.3 million invested in the company at the end of the quarter. Ray Dalio’s Bridgewater Associates also initiated a $2.1 million position during the quarter. The following funds were also among the new MAN investors: Peter Algert’s Algert Global, Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital), and Ronald Hua’s Qtron Investments.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Manpowergroup Inc (NYSE:MAN) but similarly valued. These stocks are MicroStrategy Incorporated (NASDAQ:MSTR), United States Steel Corporation (NYSE:X), C3.ai, Inc. (NYSE:AI), Halozyme Therapeutics, Inc. (NASDAQ:HALO), Stitch Fix, Inc. (NASDAQ:SFIX), BlackLine, Inc. (NASDAQ:BL), and American Campus Communities, Inc. (NYSE:ACC). This group of stocks’ market caps are closest to MAN’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.7 hedge funds with bullish positions and the average amount invested in these stocks was $346 million. That figure was $344 million in MAN’s case. United States Steel Corporation (NYSE:X) is the most popular stock in this table. On the other hand MicroStrategy Incorporated (NASDAQ:MSTR) is the least popular one with only 16 bullish hedge fund positions. Manpowergroup Inc (NYSE:MAN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for MAN is 53.7. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 beat the market again by 4.5 percentage points. Unfortunately MAN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on MAN were disappointed as the stock returned -5.2% since the end of June (through 10/15) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.