Is Magellan Midstream Partners, L.P. (MMP) A Good Stock To Buy?

Due to the fact that Magellan Midstream Partners, L.P. (NYSE:MMP) has sustained declining sentiment from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of fund managers who were dropping their full holdings in the third quarter. Interestingly, Richard Driehaus’ Driehaus Capital got rid of the largest position of all the investors tracked by Insider Monkey, valued at an estimated $8.1 million in stock. Ken Griffin’s fund, Citadel Investment Group, also dumped its call options, about $4.7 million worth.

Let’s also examine hedge fund activity in other stocks similar to Magellan Midstream Partners, L.P. (NYSE:MMP). These stocks are Ameriprise Financial, Inc. (NYSE:AMP), Equifax Inc. (NYSE:EFX), Autodesk, Inc. (NASDAQ:ADSK), and Grupo Televisa SAB (ADR) (NYSE:TV). This group of stocks’ market caps are similar to MMP’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
AMP 29 284431 -3
EFX 34 528510 8
ADSK 38 4560266 3
TV 22 1695621 0

As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $1.77 billion. That figure was $123 million in MMP’s case. Autodesk, Inc. (NASDAQ:ADSK) is the most popular stock in this table. On the other hand Grupo Televisa SAB (ADR) (NYSE:TV) is the least popular one with only 22 bullish hedge fund positions. Compared to these stocks Magellan Midstream Partners, L.P. (NYSE:MMP) is even less popular than TV. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

Disclosure: None