The successful funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary to beat the market. That’s why we pay close attention to what they think in small cap stocks. In this article, we take a closer look at Glu Mobile Inc. (NASDAQ:GLUU) from the perspective of those successful funds.
Hedge fund interest in Glu Mobile Inc. (NASDAQ:GLUU) 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 GLUU to other stocks including Consolidated-Tomoka Land Co. (NYSEAMEX:CTO), Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), and Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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With all of this in mind, we’re going to take a look at the fresh action regarding Glu Mobile Inc. (NASDAQ:GLUU).
How are hedge funds trading Glu Mobile Inc. (NASDAQ:GLUU)?
At Q3’s end, a total of 9 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the second quarter of 2016. By comparison, 13 hedge funds held shares or bullish call options in GLUU heading into this year. So, let’s find out 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, William C. Martin of Raging Capital Management holds the biggest position in Glu Mobile Inc. (NASDAQ:GLUU). Raging Capital Management has a $12.5 million position in the stock, comprising 1.7% of its 13F portfolio. Coming in second is D E Shaw, one of the biggest hedge funds in the world; with a $5.8 million position. Some other members of the smart money with similar optimism comprise Joseph A. Jolson’s Harvest Capital Strategies, John W. Rogers’s Ariel Investments and Nitin Saigal and Dan Jacobs’s Kora Management. We should note that Raging Capital Management is among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
Due to the fact that Glu Mobile Inc. (NASDAQ:GLUU) has faced bearish sentiment from hedge fund managers, it’s easy to see that there is a sect of funds who were dropping their positions entirely by the end of the third quarter. Interestingly, Jim Simons’ Renaissance Technologies said goodbye to the biggest stake of all the investors followed by Insider Monkey, totaling about $0.9 million in stock. Cliff Asness’ fund, AQR Capital Management, also said goodbye to its stock, about $0.7 million worth.
Let’s now take a look at hedge fund activity in other stocks similar to Glu Mobile Inc. (NASDAQ:GLUU). These stocks are Consolidated-Tomoka Land Co. (NYSEAMEX:CTO), Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP), and Mazor Robotics Ltd – ADR (NASDAQ:MZOR). This group of stocks’ market caps resemble GLUU’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CTO | 8 | 121400 | -1 |
| HCCI | 6 | 50196 | 2 |
| CRBP | 5 | 51279 | -2 |
| MZOR | 5 | 29463 | 0 |
As you can see these stocks had an average of 6 hedge funds with bullish positions and the average amount invested in these stocks was $63 million. That figure was $31 million in GLUU’s case. Consolidated-Tomoka Land Co. (NYSEAMEX:CTO) is the most popular stock in this table. On the other hand Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Glu Mobile Inc. (NASDAQ:GLUU) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: None
