Brightcove Inc (NASDAQ:BCOV) was in 11 hedge funds’ portfolio at the end of the first quarter of 2013. BCOV shareholders have witnessed an increase in activity from the world’s largest hedge funds in recent months. There were 8 hedge funds in our database with BCOV holdings at the end of the previous quarter.
In the eyes of most market participants, hedge funds are seen as underperforming, old investment tools of yesteryear. While there are more than 8000 funds trading at the moment, we at Insider Monkey hone in on the leaders of this club, about 450 funds. It is estimated that this group has its hands on the majority of the smart money’s total capital, and by keeping an eye on their top stock picks, we have brought to light a number of investment strategies that have historically outstripped Mr. 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Equally as integral, optimistic insider trading sentiment is another way to parse down the world of equities. As the old adage goes: there are lots of reasons for an executive to get rid of shares of his or her company, but just one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this method if you know what to do (learn more here).
Now, we’re going to take a peek at the recent action encompassing Brightcove Inc (NASDAQ:BCOV).
Hedge fund activity in Brightcove Inc (NASDAQ:BCOV)
At the end of the first quarter, a total of 11 of the hedge funds we track held long positions in this stock, a change of 38% from the first quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were increasing their holdings substantially.
When looking at the hedgies we track, Edward Gilhuly and Scott Stuart’s Sageview Capital had the biggest position in Brightcove Inc (NASDAQ:BCOV), worth close to $8.3 million, comprising 2.6% of its total 13F portfolio. Coming in second is Wilmot B. Harkey and Daniel Mack of Nantahala Capital Management, with a $6.1 million position; 1% of its 13F portfolio is allocated to the stock. Some other peers that hold long positions include Mark N. Diker’s Diker Management, Anand Parekh’s Alyeska Investment Group and Bain Capital’s Brookside Capital.
As industrywide interest jumped, key hedge funds have jumped into Brightcove Inc (NASDAQ:BCOV) headfirst. Sageview Capital, managed by Edward Gilhuly and Scott Stuart, assembled the most outsized position in Brightcove Inc (NASDAQ:BCOV). Sageview Capital had 8.3 million invested in the company at the end of the quarter. Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management also made a $6.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Jim Simons’s Renaissance Technologies, Alex Sacerdote ‘s Whale Rock Capital Management, and Ken Griffin’s Citadel Investment Group.
Insider trading activity in Brightcove Inc (NASDAQ:BCOV)
Bullish insider trading is at its handiest when the company in focus has experienced transactions within the past six months. Over the latest half-year time frame, Brightcove Inc (NASDAQ:BCOV) has seen 1 unique insiders purchasing, and 3 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Brightcove Inc (NASDAQ:BCOV). These stocks are ARC Document Solutions Inc (NYSE:ARC), QAD Inc. (NASDAQ:QADA), Unwired Planet Inc (NASDAQ:UPIP), Pervasive Software Inc. (NASDAQ:PVSW), and Magic Software Enterprises Ltd. (NASDAQ:MGIC). This group of stocks belong to the application software industry and their market caps are closest to BCOV’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| ARC Document Solutions Inc (NYSE:ARC) | 12 | 5 | 1 |
| QAD Inc. (NASDAQ:QADA) | 3 | 0 | 2 |
| Unwired Planet Inc (NASDAQ:UPIP) | 13 | 0 | 0 |
| Pervasive Software Inc. (NASDAQ:PVSW) | 8 | 0 | 0 |
| Magic Software Enterprises Ltd. (NASDAQ:MGIC) | 4 | 0 | 0 |
With the results exhibited by our strategies, retail investors should always watch hedge fund and insider trading activity, and Brightcove Inc (NASDAQ:BCOV) shareholders fit into this picture quite nicely.
