The folded buttstock is described as:
Folded for mobility, but gives less stability while aiming.
This can be found in south-east Espiritu Santo in a Unidad observation post. The accessory case is in the armoury just inside the main entrance to the right.
This outpost has two guard towers with snipers and an alarm. Take the snipers out first, as usual, and the alarm if you feel the need, but if you enter via the main entrance you probably won’t need to kill everybody to get to the armoury undetected.
This accessory gives you the folded version of the buttstock for one of the two LMGs, the MG121. For some reason it doesn’t apply to the Stoner LMG A1 which advertises a folded buttstock but for which none appears to be available in the game. Weird.
Equipping the folded buttstock increases handling a little, while sacrificing quite a lot of accuracy. With the kick on an LMG I think accuracy is more important, so I personally wouldn’t equip this, but this combat outpost is good for a little raid so you may want to collect this if you’re in the area anyway.