Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the first quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 4.5 years and analyze what the smart money thinks of Priority Technology Holdings, Inc. (NASDAQ:PRTH) based on that data.
Hedge fund interest in Priority Technology Holdings, Inc. (NASDAQ:PRTH) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare PRTH to other stocks including Liquidity Services, Inc. (NASDAQ:LQDT), Sierra Metals Inc. (NYSE:SMTS), and Level One Bancorp, Inc. (NASDAQ:LEVL) to get a better sense of its popularity.
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most market participants, hedge funds are seen as slow, outdated financial vehicles of years past. While there are greater than 8000 funds trading at present, Our researchers look at the moguls of this group, approximately 850 funds. These investment experts command bulk of the smart money’s total capital, and by watching their top equity investments, Insider Monkey has formulated numerous investment strategies that have historically beaten Mr. Market. Insider Monkey’s flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Israel Englander of Millennium Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. You can watch our latest hedge fund manager interview here and find out the name of the large-cap healthcare stock that Sio Capital’s Michael Castor expects to double. 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 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 analyze the key hedge fund action surrounding Priority Technology Holdings, Inc. (NASDAQ:PRTH).
What does smart money think about Priority Technology Holdings, Inc. (NASDAQ:PRTH)?
At Q1’s end, a total of 3 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the previous quarter. On the other hand, there were a total of 2 hedge funds with a bullish position in PRTH 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.
According to Insider Monkey’s hedge fund database, BlueCrest Capital Mgmt., managed by Michael Platt and William Reeves, holds the most valuable position in Priority Technology Holdings, Inc. (NASDAQ:PRTH). BlueCrest Capital Mgmt. has a $0.8 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Invenomic Capital Management, led by Ali Motamed, holding a $0.3 million position; 0.2% of its 13F portfolio is allocated to the stock. In terms of the portfolio weights assigned to each position Invenomic Capital Management allocated the biggest weight to Priority Technology Holdings, Inc. (NASDAQ:PRTH), around 0.22% of its 13F portfolio. BlueCrest Capital Mgmt. is also relatively very bullish on the stock, earmarking 0.05 percent of its 13F equity portfolio to PRTH.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Priority Technology Holdings, Inc. (NASDAQ:PRTH) but similarly valued. We will take a look at Liquidity Services, Inc. (NASDAQ:LQDT), Sierra Metals Inc. (NYSE:SMTS), Level One Bancorp, Inc. (NASDAQ:LEVL), and Iteris Inc (NYSE:ITI). This group of stocks’ market values resemble PRTH’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LQDT | 7 | 17843 | -1 |
| SMTS | 1 | 181 | -1 |
| LEVL | 3 | 659 | 0 |
| ITI | 11 | 11871 | 0 |
| Average | 5.5 | 7639 | -0.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.5 hedge funds with bullish positions and the average amount invested in these stocks was $8 million. That figure was $1 million in PRTH’s case. Iteris Inc (NYSE:ITI) is the most popular stock in this table. On the other hand Sierra Metals Inc. (NYSE:SMTS) is the least popular one with only 1 bullish hedge fund positions. Priority Technology Holdings, Inc. (NASDAQ:PRTH) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and 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 7.9% in 2020 through May 22nd and surpassed the market by 15.6 percentage points. Unfortunately PRTH wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); PRTH investors were disappointed as the stock returned -12.9% during the second quarter 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 most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.
