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 Mid America Apartment Communities Inc (NYSE:MAA), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is Mid America Apartment Communities Inc (NYSE:MAA) undervalued? The smart money was taking an optimistic view. The number of long hedge fund bets went up by 8 lately. Mid America Apartment Communities Inc (NYSE:MAA) was in 22 hedge funds’ portfolios at the end of September. The all time high for this statistic is 30. Our calculations also showed that MAA isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 14 hedge funds in our database with MAA holdings at the end of June.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Keeping this in mind let’s check out the fresh hedge fund action regarding Mid America Apartment Communities Inc (NYSE:MAA).
Stuart Zimmer of Zimmer Partners
Do Hedge Funds Think MAA Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 57% from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards MAA over the last 25 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
More specifically, Zimmer Partners was the largest shareholder of Mid America Apartment Communities Inc (NYSE:MAA), with a stake worth $65.4 million reported as of the end of September. Trailing Zimmer Partners was Waterfront Capital Partners, which amassed a stake valued at $61.3 million. Millennium Management, Adage Capital Management, and Citadel Investment Group 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 Waterfront Capital Partners allocated the biggest weight to Mid America Apartment Communities Inc (NYSE:MAA), around 4.32% of its 13F portfolio. Capital Growth Management is also relatively very bullish on the stock, designating 1.2 percent of its 13F equity portfolio to MAA.
As one would reasonably expect, some big names were leading the bulls’ herd. Waterfront Capital Partners, managed by Eduardo Abush, assembled the biggest position in Mid America Apartment Communities Inc (NYSE:MAA). Waterfront Capital Partners had $61.3 million invested in the company at the end of the quarter. Ken Heebner’s Capital Growth Management also made a $13.1 million investment in the stock during the quarter. The following funds were also among the new MAA investors: Michael Gelband’s ExodusPoint Capital, D. E. Shaw’s D E Shaw, and Michael Platt and William Reeves’s BlueCrest Capital Mgmt..
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Mid America Apartment Communities Inc (NYSE:MAA) but similarly valued. These stocks are PPL Corporation (NYSE:PPL), Sun Communities Inc (NYSE:SUI), Martin Marietta Materials, Inc. (NYSE:MLM), Fox Corporation (NASDAQ:FOX), Edison International (NYSE:EIX), Fortis Inc. (NYSE:FTS), and ICON Public Limited Company (NASDAQ:ICLR). This group of stocks’ market valuations are similar to MAA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PPL | 20 | 140767 | -3 |
| SUI | 33 | 794559 | 3 |
| MLM | 42 | 2154281 | 8 |
| FOX | 25 | 665945 | 0 |
| EIX | 25 | 1240177 | 7 |
| FTS | 5 | 171234 | -4 |
| ICLR | 35 | 1349183 | -4 |
| Average | 26.4 | 930878 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $931 million. That figure was $255 million in MAA’s case. Martin Marietta Materials, Inc. (NYSE:MLM) is the most popular stock in this table. On the other hand Fortis Inc. (NYSE:FTS) is the least popular one with only 5 bullish hedge fund positions. Mid America Apartment Communities Inc (NYSE:MAA) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for MAA is 55. 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 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 29.6% in 2021 and still beat the market by 3.6 percentage points. A small number of hedge funds were also right about betting on MAA as the stock returned 23.5% since the end of the third quarter (through 12/31) and outperformed the market by an even larger margin.
Follow Mid America Apartment Communities Inc. (NYSE:MAA)
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Disclosure: None. This article was originally published at Insider Monkey.
