As we already know from media reports and hedge fund investor letters, many hedge funds lost money in the third quarter, blaming macroeconomic conditions and unpredictable events that hit several sectors, with healthcare among them. Nevertheless, most investors decided to stick to their bullish theses and their long-term focus allows us to profit from the recent declines. In particular, let’s take a look at what hedge funds think about Globant SA (NYSE:GLOB) in this article.
Globant SA (NYSE:GLOB) was in 9 hedge funds’ portfolios at the end of September. Globant SA (NYSE:GLOB) shareholders have witnessed an increase in hedge fund sentiment recently. There were 4 hedge funds in our database with Globant SA (NYSE:GLOB) holdings at the end of the previous quarter. At the end of this article, we will also compare Globant SA (NYSE:GLOB) to other stocks, including OM Group, Inc. (NYSE:OMG), CSG Systems International, Inc. (NASDAQ:CSGS), and FelCor Lodging Trust Incorporated (NYSE:FCH) to get a better sense of its popularity.
In the 21st century investor’s toolkit, there are numerous tools that stock market investors can use to value publicly traded companies. A pair of the most useful tools are hedge fund and insider trading activity. We have shown that, historically, those who follow the best picks of the top hedge fund managers can outclass the broader indices by a significant margin (see the details here).
With all of this in mind, we’re going to take a gander at the new action regarding Globant SA (NYSE:GLOB).
How have hedgies been trading Globant SA (NYSE:GLOB)?
Heading into Q4, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 125% from one quarter earlier. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Richard Driehaus’ Driehaus Capital has the number one position in Globant SA (NYSE:GLOB), worth close to $15.4 million, accounting for 0.6% of its total 13F portfolio. Coming in second is Matthew A. Weatherbie of Weatherbie Capital, with a $13.9 million position; the fund has 1.6% of its 13F portfolio invested in the stock. Other peers that are bullish contain Brian Ashford-Russell and Tim Woolley’s Polar Capital, Renaissance Technologies, and Robert B. Gillam’s McKinley Capital Management.
As aggregate interest increased, key money managers have jumped into Globant SA (NYSE:GLOB) headfirst. Polar Capital assembled the most valuable position in Globant SA (NYSE:GLOB). Polar Capital had $7.2 million invested in the company at the end of the quarter. Robert B. Gillam’s McKinley Capital Management also made a $3.4 million investment in the stock during the quarter. The other funds with brand new GLOB positions are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Cliff Asness’ AQR Capital Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Globant SA (NYSE:GLOB) but similarly valued. These stocks are OM Group, Inc. (NYSE:OMG), CSG Systems International, Inc. (NASDAQ:CSGS), FelCor Lodging Trust Incorporated (NYSE:FCH), and Brady Corp (NYSE:BRC). This group of stocks’ market caps resembles Globant SA (NYSE:GLOB)’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| OMG | 24 | 163274 | -10 |
| CSGS | 22 | 145892 | 1 |
| FCH | 22 | 102418 | -2 |
| BRC | 10 | 154092 | 0 |
As you can see, these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $141 million. That figure was $47 million in Globant SA (NYSE:GLOB)’s case. OM Group, Inc. (NYSE:OMG) is the most popular stock in this table. On the other hand, Brady Corp (NYSE:BRC) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks, Globant SA (NYSE:GLOB) is even less popular than Brady Corp (NYSE:BRC). Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.