Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Altria Group Inc (NYSE:MO), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Altria Group Inc (NYSE:MO) shareholders have witnessed an increase in enthusiasm from smart money of late. Altria Group Inc (NYSE:MO) was in 38 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 54. There were 37 hedge funds in our database with MO positions at the end of the fourth quarter. Our calculations also showed that MO isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
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Do Hedge Funds Think MO Is A Good Stock To Buy Now?
At Q1’s end, a total of 38 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from one quarter earlier. By comparison, 46 hedge funds held shares or bullish call options in MO a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Altria Group Inc (NYSE:MO) was held by Citadel Investment Group, which reported holding $261.6 million worth of stock at the end of December. It was followed by Arrowstreet Capital with a $155 million position. Other investors bullish on the company included Renaissance Technologies, D E Shaw, and Adage Capital Management. In terms of the portfolio weights assigned to each position Kehrs Ridge Capital allocated the biggest weight to Altria Group Inc (NYSE:MO), around 7.35% of its 13F portfolio. Callodine Capital Management is also relatively very bullish on the stock, dishing out 5 percent of its 13F equity portfolio to MO.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. GQG Partners, managed by Rajiv Jain, created the most outsized position in Altria Group Inc (NYSE:MO). GQG Partners had $87 million invested in the company at the end of the quarter. John Hempton’s Bronte Capital also initiated a $14.7 million position during the quarter. The following funds were also among the new MO investors: Brian Scudieri’s Kehrs Ridge Capital, David Costen Haley’s HBK Investments, and Mark Travis’s Intrepid Capital Management.
Let’s go over hedge fund activity in other stocks similar to Altria Group Inc (NYSE:MO). We will take a look at Zoom Video Communications, Inc. (NASDAQ:ZM), Stryker Corporation (NYSE:SYK), GlaxoSmithKline plc (NYSE:GSK), Vale SA (NYSE:VALE), British American Tobacco plc (NYSE:BTI), Anthem Inc (NYSE:ANTM), and Intuitive Surgical, Inc. (NASDAQ:ISRG). All of these stocks’ market caps match MO’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ZM | 54 | 5672277 | -5 |
| SYK | 46 | 3154010 | 2 |
| GSK | 25 | 1359731 | -5 |
| VALE | 31 | 2615665 | -4 |
| BTI | 14 | 1034777 | 4 |
| ANTM | 58 | 5373054 | -12 |
| ISRG | 53 | 2326096 | 4 |
| Average | 40.1 | 3076516 | -2.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 40.1 hedge funds with bullish positions and the average amount invested in these stocks was $3077 million. That figure was $1109 million in MO’s case. Anthem Inc (NYSE:ANTM) is the most popular stock in this table. On the other hand British American Tobacco plc (NYSE:BTI) is the least popular one with only 14 bullish hedge fund positions. Altria Group Inc (NYSE:MO) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MO is 54.4. 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 negative signal and 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 19.3% in 2021 through June 25th and surpassed the market again by 4.8 percentage points. Unfortunately MO wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); MO investors were disappointed as the stock returned -5.3% since the end of March (through 6/25) 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 most of these stocks already outperformed the market in 2021.
Follow Altria Group Inc. (NYSE:MO)
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Disclosure: None. This article was originally published at Insider Monkey.
