Were Hedge Funds Right About Mondelez (MDLZ)?

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 December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Mondelez International Inc (NASDAQ:MDLZ).

Hedge fund interest in Mondelez International Inc (NASDAQ:MDLZ) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that MDLZ isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings). At the end of this article we will also compare MDLZ to other stocks including Mercadolibre Inc (NASDAQ:MELI), The TJX Companies, Inc. (NYSE:TJX), and Anthem Inc (NYSE:ANTM) to get a better sense of its popularity.

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Nelson Peltz of Trian Partners

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Do Hedge Funds Think MDLZ Is A Good Stock To Buy Now?

At fourth quarter’s end, a total of 50 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from one quarter earlier. By comparison, 50 hedge funds held shares or bullish call options in MDLZ a year ago. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Nelson Peltz’s Trian Partners has the most valuable position in Mondelez International Inc (NASDAQ:MDLZ), worth close to $715.8 million, comprising 10.6% of its total 13F portfolio. On Trian Partners’s heels is Ric Dillon of Diamond Hill Capital, with a $489.2 million position; the fund has 2.3% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions comprise D. E. Shaw’s D E Shaw, Lei Zhang’s Hillhouse Capital Management and Brett Barakett’s Tremblant Capital. In terms of the portfolio weights assigned to each position Trian Partners allocated the biggest weight to Mondelez International Inc (NASDAQ:MDLZ), around 10.59% of its 13F portfolio. Tremblant Capital is also relatively very bullish on the stock, designating 3.33 percent of its 13F equity portfolio to MDLZ.

Since Mondelez International Inc (NASDAQ:MDLZ) has faced bearish sentiment from hedge fund managers, we can see that there was a specific group of fund managers that decided to sell off their full holdings by the end of the fourth quarter. It’s worth mentioning that Brian Scudieri’s Kehrs Ridge Capital dumped the largest investment of the 750 funds monitored by Insider Monkey, totaling close to $44.4 million in stock, and Louis Bacon’s Moore Global Investments was right behind this move, as the fund cut about $27.9 million worth. These transactions are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now take a look at hedge fund activity in other stocks similar to Mondelez International Inc (NASDAQ:MDLZ). These stocks are Mercadolibre Inc (NASDAQ:MELI), The TJX Companies, Inc. (NYSE:TJX), Anthem Inc (NYSE:ANTM), Snowflake Inc (NYSE:SNOW), S&P Global Inc. (NYSE:SPGI), Applied Materials, Inc. (NASDAQ:AMAT), and Zoetis Inc (NYSE:ZTS). All of these stocks’ market caps resemble MDLZ’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MELI 79 8766711 -2
TJX 68 2297227 -10
ANTM 70 5186728 5
SNOW 54 7723382 -5
SPGI 75 3807859 4
AMAT 61 3632227 2
ZTS 61 2389697 3
Average 66.9 4829119 -0.4

View table here if you experience formatting issues.

As you can see these stocks had an average of 66.9 hedge funds with bullish positions and the average amount invested in these stocks was $4829 million. That figure was $2626 million in MDLZ’s case. Mercadolibre Inc (NASDAQ:MELI) is the most popular stock in this table. On the other hand Snowflake Inc (NYSE:SNOW) is the least popular one with only 54 bullish hedge fund positions. Compared to these stocks Mondelez International Inc (NASDAQ:MDLZ) is even less popular than SNOW. Our overall hedge fund sentiment score for MDLZ is 26.7. 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. Hedge funds dodged a bullet by taking a bearish stance towards MDLZ. Our calculations showed that the top 10 most popular hedge fund stocks returned 90.7% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 35 percentage points. These stocks gained 13.6% in 2021 through April 30th but managed to beat the market again by 1.6 percentage points. Unfortunately MDLZ wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); MDLZ investors were disappointed as the stock returned 4.5% since the end of the fourth quarter (through 4/30) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.

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Disclosure: None. This article was originally published at Insider Monkey.