QuinStreet Inc (NASDAQ:QNST) has experienced an increase in activity from the world’s largest hedge funds in recent months.
If you’d ask most shareholders, hedge funds are perceived as worthless, old investment vehicles of yesteryear. While there are over 8000 funds in operation today, we hone in on the top tier of this club, around 450 funds. Most estimates calculate that this group controls the majority of the hedge fund industry’s total capital, and by monitoring their highest performing equity investments, we have formulated a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Equally as beneficial, positive insider trading sentiment is another way to parse down the marketplace. Obviously, there are plenty of reasons for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the market-beating potential of this strategy if investors understand what to do (learn more here).
With these “truths” under our belt, we’re going to take a gander at the recent action encompassing QuinStreet Inc (NASDAQ:QNST).
How have hedgies been trading QuinStreet Inc (NASDAQ:QNST)?
At year’s end, a total of 8 of the hedge funds we track were bullish in this stock, a change of 100% from the previous quarter. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their holdings considerably.
According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the largest position in QuinStreet Inc (NASDAQ:QNST). Royce & Associates has a $9 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Coatue Management, managed by Philippe Laffont, which held a $3.5 million position; 0.1% of its 13F portfolio is allocated to the company. Other hedge funds that are bullish include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Charles Davidson’s Wexford Capital.
Consequently, some big names have been driving this bullishness. Wexford Capital, managed by Charles Davidson, assembled the biggest position in QuinStreet Inc (NASDAQ:QNST). Wexford Capital had 0.2 million invested in the company at the end of the quarter. Cliff Asness’s AQR Capital Management also initiated a $0.2 million position during the quarter. The other funds with new positions in the stock are Paul Tudor Jones’s Tudor Investment Corp and John Overdeck and David Siegel’s Two Sigma Advisors.
How are insiders trading QuinStreet Inc (NASDAQ:QNST)?
Insider buying is at its handiest when the company we’re looking at has experienced transactions within the past half-year. Over the last 180-day time frame, QuinStreet Inc (NASDAQ:QNST) has seen 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to QuinStreet Inc (NASDAQ:QNST). These stocks are ModusLink Global Solutions, Inc. (NASDAQ:MLNK), Support.com, Inc. (NASDAQ:SPRT), Vocus, Inc. (NASDAQ:VOCS), Keynote Systems, Inc. (NASDAQ:KEYN), and ClickSoftware Technologies Ltd. (NASDAQ:CKSW). This group of stocks belong to the internet software & services industry and their market caps are closest to QNST’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| ModusLink Global Solutions, Inc. (NASDAQ:MLNK) | 6 | 1 | 0 |
| Support.com, Inc. (NASDAQ:SPRT) | 6 | 1 | 2 |
| Vocus, Inc. (NASDAQ:VOCS) | 6 | 1 | 5 |
| Keynote Systems, Inc. (NASDAQ:KEYN) | 9 | 0 | 5 |
| ClickSoftware Technologies Ltd. (NASDAQ:CKSW) | 6 | 0 | 0 |
With the results demonstrated by our studies, everyday investors should always watch hedge fund and insider trading activity, and QuinStreet Inc (NASDAQ:QNST) shareholders fit into this picture quite nicely.
