Hedge Funds Are Betting On Manitex International, Inc. (MNTX)
Debasis Saha
6 min read
In this article you are going to find out whether hedge funds think Manitex International, Inc. (NASDAQ:MNTX) is a good investment right now. We like to check what the smart money thinks first before doing extensive research on a given stock. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It's not surprising given that hedge funds have access to better information and more resources to predict the winners in the stock market.
Manitex International, Inc. (NASDAQ:MNTX) shareholders have witnessed an increase in support from the world's most elite money managers lately. MNTX was in 7 hedge funds' portfolios at the end of March. There were 6 hedge funds in our database with MNTX holdings at the end of the previous quarter. Our calculations also showed that MNTX isn't among the 30 most popular stocks among hedge funds (click for Q1 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.
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 101% since March 2017 and outperformed the S&P 500 ETFs by more than 58 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we're going to take a gander at the key hedge fund action regarding Manitex International, Inc. (NASDAQ:MNTX).
How have hedgies been trading Manitex International, Inc. (NASDAQ:MNTX)?
At Q1's end, a total of 7 of the hedge funds tracked by Insider Monkey were long this stock, a change of 17% from the fourth quarter of 2019. Below, you can check out the change in hedge fund sentiment towards MNTX over the last 18 quarters. With hedgies' capital changing hands, there exists an "upper tier" of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
Is MNTX A Good Stock To Buy?
The largest stake in Manitex International, Inc. (NASDAQ:MNTX) was held by Rutabaga Capital Management, which reported holding $3.9 million worth of stock at the end of September. It was followed by Royce & Associates with a $2.4 million position. Other investors bullish on the company included Cannell Capital, Potrero Capital Research, and Beddow Capital Management. In terms of the portfolio weights assigned to each position Rutabaga Capital Management allocated the biggest weight to Manitex International, Inc. (NASDAQ:MNTX), around 2.34% of its 13F portfolio. Cannell Capital is also relatively very bullish on the stock, earmarking 0.44 percent of its 13F equity portfolio to MNTX.
Consequently, specific money managers have jumped into Manitex International, Inc. (NASDAQ:MNTX) headfirst. Millennium Management, managed by Israel Englander, established the most valuable position in Manitex International, Inc. (NASDAQ:MNTX). Millennium Management had $0 million invested in the company at the end of the quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Manitex International, Inc. (NASDAQ:MNTX) but similarly valued. We will take a look at IDEAYA Biosciences, Inc. (NASDAQ:IDYA), HireQuest, Inc. (NASDAQ:HQI), Tanzanian Royalty Exploration Corp. (US) (NYSE:TRX), and TravelCenters of America LLC (NYSE:TA). This group of stocks' market caps are similar to MNTX's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IDYA,6,12292,-3 HQI,2,711,0 TRX,1,15,0 TA,7,8444,0 Average,4,5366,-0.75 [/table]
As you can see these stocks had an average of 4 hedge funds with bullish positions and the average amount invested in these stocks was $5 million. That figure was $8 million in MNTX's case. TravelCenters of America LLC (NYSE:TA) is the most popular stock in this table. On the other hand Tanzanian Royalty Exploration Corp. (US) (NYSE:TRX) is the least popular one with only 1 bullish hedge fund positions. Manitex International, Inc. (NASDAQ:MNTX) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th but beat the market by 14.2 percentage points. Unfortunately MNTX wasn't nearly as popular as these 10 stocks and hedge funds that were betting on MNTX were disappointed as the stock returned 12.6% during the same time period 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 many of these stocks already outperformed the market so far this year.
