Avid Technology, Inc. (AVID): Hedge Fund Sentiment Unchanged

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of September 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Avid Technology, Inc. (NASDAQ:AVID).

Hedge fund interest in Avid Technology, Inc. (NASDAQ:AVID) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that AVID isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). At the end of this article we will also compare AVID to other stocks including Primoris Services Corp (NASDAQ:PRIM), Berkeley Lights, Inc. (NASDAQ:BLI), and Getty Realty Corp. (NYSE:GTY) to get a better sense of its popularity.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so 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. With all of this in mind we’re going to check out the new hedge fund action surrounding Avid Technology, Inc. (NASDAQ:AVID).

Brad Farber of Atika Capital

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

At the end of the third quarter, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards AVID over the last 25 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Impactive Capital was the largest shareholder of Avid Technology, Inc. (NASDAQ:AVID), with a stake worth $199 million reported as of the end of September. Trailing Impactive Capital was Royce & Associates, which amassed a stake valued at $60.3 million. Cowbird Capital, Atika Capital, and Brahman Capital 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 Impactive Capital allocated the biggest weight to Avid Technology, Inc. (NASDAQ:AVID), around 15.61% of its 13F portfolio. Cowbird Capital is also relatively very bullish on the stock, setting aside 8.84 percent of its 13F equity portfolio to AVID.

Since Avid Technology, Inc. (NASDAQ:AVID) has witnessed declining sentiment from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of hedge funds who sold off their positions entirely last quarter. It’s worth mentioning that Mark Broach’s Manatuck Hill Partners said goodbye to the largest stake of the “upper crust” of funds monitored by Insider Monkey, worth about $6.1 million in stock. Ira Unschuld’s fund, Brant Point Investment Management, also said goodbye to its stock, about $5.5 million worth. These transactions are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s also examine hedge fund activity in other stocks similar to Avid Technology, Inc. (NASDAQ:AVID). We will take a look at Primoris Services Corp (NASDAQ:PRIM), Berkeley Lights, Inc. (NASDAQ:BLI), Getty Realty Corp. (NYSE:GTY), Apria, Inc. (NASDAQ:APR), Sangamo Therapeutics, Inc. (NASDAQ:SGMO), Broadmark Realty Capital Inc. (NYSE:BRMK), and First Commonwealth Financial Corporation (NYSE:FCF). This group of stocks’ market caps match AVID’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 13.3 hedge funds with bullish positions and the average amount invested in these stocks was $91 million. That figure was $427 million in AVID’s case. Primoris Services Corp (NASDAQ:PRIM) is the most popular stock in this table. On the other hand Getty Realty Corp. (NYSE:GTY) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Avid Technology, Inc. (NASDAQ:AVID) is more popular among hedge funds. Our overall hedge fund sentiment score for AVID is 79.2. 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. 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 returned 29.6% in 2021 and managed to beat the market by 3.6 percentage points. Hedge funds were also right about betting on AVID as the stock returned 12.6% since the end of September (through 12/31) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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