A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on Medtronic PLC (NYSE:MDT).
Medtronic PLC (NYSE:MDT) investors should be aware of a decrease in enthusiasm from smart money of late. At the end of this article we will also compare MDT to other stocks including Intel Corporation (NASDAQ:INTC), Toyota Motor Corporation (ADR) (NYSE:TM), and PepsiCo, Inc. (NYSE:PEP) to get a better sense of its popularity.
Follow Medtronic Inc (Old Filings) (NYSE:MDT)
Follow Medtronic Inc (Old Filings) (NYSE:MDT)
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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With all of this in mind, we’re going to take a peek at the recent action regarding Medtronic PLC (NYSE:MDT).
What have hedge funds been doing with Medtronic PLC (NYSE:MDT)?
Heading into the fourth quarter of 2016, a total of 43 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 14% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were upping their holdings meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, holds the biggest position in Medtronic PLC (NYSE:MDT). Arrowstreet Capital has a $219.7 million position in the stock, comprising 0.7% of its 13F portfolio. The second most bullish fund manager is Ric Dillon of Diamond Hill Capital, with a $206.1 million position; 1.3% of its 13F portfolio is allocated to the company. Other peers that are bullish consist of Phill Gross and Robert Atchinson’s Adage Capital Management, Brian Ashford-Russell and Tim Woolley’s Polar Capital and Paul Marshall and Ian Wace’s Marshall Wace LLP.
Seeing as Medtronic PLC (NYSE:MDT) has faced declining sentiment from hedge fund managers, we can see that there were a few fund managers that decided to sell off their full holdings by the end of the third quarter. At the top of the heap, Jean-Marie Eveillard’s First Eagle Investment Management said goodbye to the largest position of the “upper crust” of funds tracked by Insider Monkey, valued at an estimated $96 million in call options, and Ken Griffin’s Citadel Investment Group was right behind this move, as the fund cut about $50.4 million worth of options. These moves are important to note, as total hedge fund interest was cut by 7 funds by the end of the third quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Medtronic PLC (NYSE:MDT) but similarly valued. We will take a look at Intel Corporation (NASDAQ:INTC), Toyota Motor Corporation (ADR) (NYSE:TM), PepsiCo, Inc. (NYSE:PEP), and International Business Machines Corp. (NYSE:IBM). All of these stocks’ market caps are closest to MDT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| INTC | 68 | 4883403 | 11 |
| TM | 12 | 300189 | -1 |
| PEP | 57 | 4790976 | -1 |
| IBM | 55 | 14645949 | 2 |
As you can see these stocks had an average of 48 hedge funds with bullish positions and the average amount invested in these stocks was $6.16 billion. That figure was $1.29 billion in MDT’s case. Intel Corporation (NASDAQ:INTC) is the most popular stock in this table. On the other hand Toyota Motor Corporation (ADR) (NYSE:TM) is the least popular one with only 12 bullish hedge fund positions. Medtronic PLC (NYSE:MDT) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard INTC might be a better candidate to consider a long position.
