Is Mobile TeleSystems (MBT) A Good Stock To Buy?

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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 June. 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 Mobile TeleSystems Public Joint Stock Company (NYSE:MBT), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Is MBT a good stock to buy? Mobile TeleSystems Public Joint Stock Company (NYSE:MBT) has seen a decrease in hedge fund sentiment recently. Mobile TeleSystems Public Joint Stock Company (NYSE:MBT) was in 10 hedge funds’ portfolios at the end of June. The all time high for this statistic is 19. There were 11 hedge funds in our database with MBT holdings at the end of March. Our calculations also showed that MBT isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 185.4% since March 2017 and outperformed the S&P 500 ETFs by more than 79 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

Ian Wace Marshall Wace

Ian Wace of Marshall Wace

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 homepage. Now we’re going to analyze the new hedge fund action surrounding Mobile TeleSystems Public Joint Stock Company (NYSE:MBT).

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

At the end of June, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -9% from the previous quarter. On the other hand, there were a total of 11 hedge funds with a bullish position in MBT a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, Renaissance Technologies held the most valuable stake in Mobile TeleSystems Public Joint Stock Company (NYSE:MBT), which was worth $204.7 million at the end of the second quarter. On the second spot was Arrowstreet Capital which amassed $40.5 million worth of shares. D E Shaw, AQR 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 Renaissance Technologies allocated the biggest weight to Mobile TeleSystems Public Joint Stock Company (NYSE:MBT), around 0.26% of its 13F portfolio. Polunin Capital is also relatively very bullish on the stock, dishing out 0.24 percent of its 13F equity portfolio to MBT.

Judging by the fact that Mobile TeleSystems Public Joint Stock Company (NYSE:MBT) has witnessed declining sentiment from the smart money, we can see that there lies a certain “tier” of funds that elected to cut their entire stakes by the end of the second quarter. Intriguingly, Andre F. Perold’s HighVista Strategies dumped the biggest stake of the 750 funds followed by Insider Monkey, comprising an estimated $0.3 million in stock, and Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors was right behind this move, as the fund dumped about $0.2 million worth. These transactions are interesting, as aggregate hedge fund interest dropped by 1 funds by the end of the second quarter.

Let’s go over hedge fund activity in other stocks similar to Mobile TeleSystems Public Joint Stock Company (NYSE:MBT). These stocks are Autohome Inc (NYSE:ATHM), Gentex Corporation (NASDAQ:GNTX), Donaldson Company, Inc. (NYSE:DCI), Amedisys Inc (NASDAQ:AMED), Grupo Televisa SAB (NYSE:TV), Melco Resorts & Entertainment Limited (NASDAQ:MLCO), and Hyatt Hotels Corporation (NYSE:H). All of these stocks’ market caps match MBT’s market cap.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ATHM,16,344855,-2 GNTX,34,440659,-1 DCI,21,258723,-7 AMED,26,271283,0 TV,17,1116489,2 MLCO,29,755083,0 H,23,661481,0 Average,23.7,549796,-1.1 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 23.7 hedge funds with bullish positions and the average amount invested in these stocks was $550 million. That figure was $293 million in MBT’s case. Gentex Corporation (NASDAQ:GNTX) is the most popular stock in this table. On the other hand Autohome Inc (NYSE:ATHM) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks Mobile TeleSystems Public Joint Stock Company (NYSE:MBT) is even less popular than ATHM. Our overall hedge fund sentiment score for MBT is 19.8. 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 clearly dropped the ball on MBT as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. 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 25.7% in 2021 through September 27th and still beat the market by 6.2 percentage points. A small number of hedge funds were also right about betting on MBT as the stock returned 14.7% since Q2 (through September 27th) and outperformed the market by an even larger margin.

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