The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Mantech International Corp (NASDAQ:MANT).
Is MANT a good stock to buy now? Mantech International Corp (NASDAQ:MANT) has experienced an increase in hedge fund interest lately. Mantech International Corp (NASDAQ:MANT) was in 17 hedge funds’ portfolios at the end of September. The all time high for this statistic is 23. There were 16 hedge funds in our database with MANT positions at the end of the second quarter. Our calculations also showed that MANT isn’t among the 30 most popular stocks among hedge funds (click for Q3 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.
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 66 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren’t comfortable with shorting stocks, you should at least avoid initiating long positions in stocks that are in our short portfolio.
Michael Gelband of ExodusPoint Capital
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks 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. Keeping this in mind we’re going to analyze the new hedge fund action surrounding Mantech International Corp (NASDAQ:MANT).
Do Hedge Funds Think MANT Is A Good Stock To Buy Now?
At third quarter’s end, a total of 17 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the second quarter of 2020. On the other hand, there were a total of 16 hedge funds with a bullish position in MANT a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Lunia Capital was the largest shareholder of Mantech International Corp (NASDAQ:MANT), with a stake worth $4.4 million reported as of the end of September. Trailing Lunia Capital was Two Sigma Advisors, which amassed a stake valued at $2.4 million. Millennium Management, Renaissance Technologies, and Horizon Asset Management 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 Lunia Capital allocated the biggest weight to Mantech International Corp (NASDAQ:MANT), around 1.93% of its 13F portfolio. Quantinno Capital is also relatively very bullish on the stock, designating 0.29 percent of its 13F equity portfolio to MANT.
As aggregate interest increased, some big names have jumped into Mantech International Corp (NASDAQ:MANT) headfirst. Lunia Capital, managed by Vikas Lunia, assembled the most valuable position in Mantech International Corp (NASDAQ:MANT). Lunia Capital had $4.4 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $1.2 million investment in the stock during the quarter. The following funds were also among the new MANT investors: Donald Sussman’s Paloma Partners, Mika Toikka’s AlphaCrest Capital Management, and Michael Gelband’s ExodusPoint Capital.
Let’s go over hedge fund activity in other stocks similar to Mantech International Corp (NASDAQ:MANT). These stocks are Blackbaud, Inc. (NASDAQ:BLKB), Valley National Bancorp (NASDAQ:VLY), eXp World Holdings, Inc. (NASDAQ:EXPI), American States Water Co (NYSE:AWR), Bank OZK (NASDAQ:OZK), Synaptics Incorporated (NASDAQ:SYNA), and WPX Energy Inc (NYSE:WPX). All of these stocks’ market caps match MANT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BLKB | 21 | 75478 | 2 |
| VLY | 21 | 38853 | 4 |
| EXPI | 14 | 111222 | 3 |
| AWR | 21 | 54964 | 1 |
| OZK | 20 | 178260 | 3 |
| SYNA | 23 | 370429 | -5 |
| WPX | 29 | 225279 | -8 |
| Average | 21.3 | 150641 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.3 hedge funds with bullish positions and the average amount invested in these stocks was $151 million. That figure was $20 million in MANT’s case. WPX Energy Inc (NYSE:WPX) is the most popular stock in this table. On the other hand eXp World Holdings, Inc. (NASDAQ:EXPI) is the least popular one with only 14 bullish hedge fund positions. Mantech International Corp (NASDAQ:MANT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MANT is 38.2. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. A small number of hedge funds were also right about betting on MANT as the stock returned 19.3% since the end of the third quarter (through 12/14) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
