Why Monsanto Company (MON) Is in Spotlight Today?

Monsanto Company (NYSE:MON) shares are up almost 3% after the analysts at Jefferies upgraded the stock to ‘Buy’ from ‘Hold’ and bumped up their price target to $132 from $95 per share. The analysts think an increased takeover offer of $130 or more from Bayer is highly probable as the company tries to acquire Monsanto. Monsanto previously rejected Bayer’s $122 offer as too low, but hasn’t rejected the deal in principle. The company could be amenable to a sale if the offer were raised. There is also the possibility that Bayer might go hostile in its attempt to take over Monsanto.

Hedge funds seem to be betting on a successful deal, as the number of long hedge fund bets increased by 13 lately. MON was in 51 hedge funds’ portfolios at the end of the first quarter of 2016, compared to 38 hedge funds in our database with MON holdings at the end of the previous quarter. At the end of this article we will also compare MON to other stocks, including Syngenta AG (ADR) (NYSE:SYT), Cognizant Technology Solutions Corp (NASDAQ:CTSH), and Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) to get a better sense of its popularity.

At the moment there are many signals market participants can use to evaluate stocks. A couple of the most under-the-radar signals are hedge fund and insider trading interest. Our experts have shown that, historically, those who follow the best picks of the top hedge fund managers can outperform the S&P 500 by a very impressive amount (see the details here).

According to publicly-available hedge fund and institutional investor holdings data compiled by Insider Monkey, Larry Robbins’ Glenview Capital has the largest position in Monsanto Company (NYSE:MON), worth close to $973.2 million, comprising 7.1% of its total 13F portfolio. Coming in second is John H. Scully’s SPO Advisory Corp, with a $318.6 million position; 5.8% of its 13F portfolio is allocated to the stock. Remaining peers with similar optimism consist of Ricky Sandler’s Eminence Capital, Ken Griffin’s Citadel Investment Group and John Overdeck and David Siegel’s Two Sigma Advisors.

As industry-wide interest jumped, key money managers have been driving this bullishness. On the next page, we are going to take a look at some funds that added Monsanto to their equity portfolio between January and March.