The latest 13F reporting period has come and gone, and Insider Monkey have plowed through 823 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of June 30th, when the S&P 500 Index was trading around the 3100 level. Since the end of March, investors decided to bet on the economic recovery and a stock market rebound. S&P 500 Index returned more than 50% since its bottom. In this article you are going to find out whether hedge funds thought MagnaChip Semiconductor Corporation (NYSE:MX) was a good investment heading into the third quarter and how the stock traded in comparison to the top hedge fund picks.
MagnaChip Semiconductor Corporation (NYSE:MX) has experienced an increase in hedge fund sentiment of late. MagnaChip Semiconductor Corporation (NYSE:MX) was in 25 hedge funds’ portfolios at the end of June. The all time high for this statistics is 27. There were 22 hedge funds in our database with MX holdings at the end of March. Our calculations also showed that MX isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
To the average investor there are dozens of tools shareholders employ to size up stocks. A duo of the most innovative tools are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the top picks of the top money managers can beat the market by a significant margin (see the details here).
Steven Cohen of Point72 Asset Management
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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 to get excerpts of these letters in your inbox. Now we’re going to go over the recent hedge fund action regarding MagnaChip Semiconductor Corporation (NYSE:MX).
Hedge fund activity in MagnaChip Semiconductor Corporation (NYSE:MX)
Heading into the third quarter of 2020, a total of 25 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 14% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards MX over the last 20 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Oaktree Capital Management was the largest shareholder of MagnaChip Semiconductor Corporation (NYSE:MX), with a stake worth $30.3 million reported as of the end of September. Trailing Oaktree Capital Management was Rubric Capital Management, which amassed a stake valued at $26.9 million. Brigade Capital, Toronado Partners, and Greenhouse Funds 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 North Run Capital allocated the biggest weight to MagnaChip Semiconductor Corporation (NYSE:MX), around 9.54% of its 13F portfolio. Cumberland Associates / Springowl Associates is also relatively very bullish on the stock, earmarking 4.98 percent of its 13F equity portfolio to MX.
Now, key hedge funds were leading the bulls’ herd. Greenhouse Funds, managed by Joe Milano, created the largest position in MagnaChip Semiconductor Corporation (NYSE:MX). Greenhouse Funds had $11.8 million invested in the company at the end of the quarter. Steve Cohen’s Point72 Asset Management also made a $11.1 million investment in the stock during the quarter. The following funds were also among the new MX investors: Israel Englander’s Millennium Management, Nathaniel August’s Mangrove Partners, and Michael Gelband’s ExodusPoint Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as MagnaChip Semiconductor Corporation (NYSE:MX) but similarly valued. These stocks are Sprague Resources LP (NYSE:SRLP), Community Health Systems (NYSE:CYH), MasterCraft Boat Holdings, Inc. (NASDAQ:MCFT), U.S. Auto Parts Network, Inc. (NASDAQ:PRTS), Navigator Holdings Ltd (NYSE:NVGS), Loop Industries, Inc. (NASDAQ:LOOP), and Cytosorbents Corp (NASDAQ:CTSO). This group of stocks’ market caps resemble MX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SRLP | 1 | 580 | -3 |
| CYH | 18 | 141485 | -2 |
| MCFT | 21 | 130750 | 1 |
| PRTS | 14 | 68315 | 9 |
| NVGS | 14 | 23631 | 1 |
| LOOP | 2 | 415 | 2 |
| CTSO | 9 | 17186 | 0 |
| Average | 11.3 | 54623 | 1.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 11.3 hedge funds with bullish positions and the average amount invested in these stocks was $55 million. That figure was $173 million in MX’s case. MasterCraft Boat Holdings, Inc. (NASDAQ:MCFT) is the most popular stock in this table. On the other hand Sprague Resources LP (NYSE:SRLP) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks MagnaChip Semiconductor Corporation (NYSE:MX) is more popular among hedge funds. Our overall hedge fund sentiment score for MX is 85.8. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks returned 21.3% in 2020 through September 25th but still managed to beat the market by 17.7 percentage points. Hedge funds were also right about betting on MX as the stock returned 30.2% since the end of June and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
