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 Comtech Telecommunications Corp. (NASDAQ:CMTL) based on that data.
Comtech Telecommunications Corp. (NASDAQ:CMTL) was in 18 hedge funds’ portfolios at the end of March. CMTL shareholders have witnessed an increase in activity from the world’s largest hedge funds lately. There were 17 hedge funds in our database with CMTL holdings at the end of the previous quarter. Our calculations also showed that CMTL isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most traders, hedge funds are seen as unimportant, old investment vehicles of yesteryear. While there are greater than 8000 funds with their doors open today, Our experts look at the moguls of this club, around 850 funds. Most estimates calculate that this group of people command bulk of all hedge funds’ total capital, and by paying attention to their inimitable picks, Insider Monkey has figured out numerous investment strategies that have historically defeated Mr. Market. Insider Monkey’s flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points a year 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 .
Peter Rathjens of Arrowstreet Capital
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. 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 the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let’s take a peek at the recent hedge fund action surrounding Comtech Telecommunications Corp. (NASDAQ:CMTL).
What does smart money think about Comtech Telecommunications Corp. (NASDAQ:CMTL)?
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the fourth quarter of 2019. On the other hand, there were a total of 20 hedge funds with a bullish position in CMTL a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Huber Capital Management was the largest shareholder of Comtech Telecommunications Corp. (NASDAQ:CMTL), with a stake worth $14.3 million reported as of the end of September. Trailing Huber Capital Management was Renaissance Technologies, which amassed a stake valued at $11 million. Rubric Capital Management, Royce & Associates, and Alpine Associates were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Huber Capital Management allocated the biggest weight to Comtech Telecommunications Corp. (NASDAQ:CMTL), around 2.62% of its 13F portfolio. Rubric Capital Management is also relatively very bullish on the stock, setting aside 1.11 percent of its 13F equity portfolio to CMTL.
As aggregate interest increased, key money managers were leading the bulls’ herd. Rubric Capital Management, managed by David Rosen, created the most outsized position in Comtech Telecommunications Corp. (NASDAQ:CMTL). Rubric Capital Management had $7 million invested in the company at the end of the quarter. Robert Emil Zoellner’s Alpine Associates also made a $3.5 million investment in the stock during the quarter. The other funds with brand new CMTL positions are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Greg Eisner’s Engineers Gate Manager, and Marc Majzner’s Clearline Capital.
Let’s now take a look at hedge fund activity in other stocks similar to Comtech Telecommunications Corp. (NASDAQ:CMTL). We will take a look at Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX), Farmers National Banc Corp (NASDAQ:FMNB), SiTime Corporation (NASDAQ:SITM), and Allot Ltd. (NASDAQ:ALLT). This group of stocks’ market valuations match CMTL’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PGNX | 12 | 43464 | 2 |
| FMNB | 9 | 14554 | 0 |
| SITM | 3 | 12026 | -1 |
| ALLT | 13 | 107352 | 3 |
| Average | 9.25 | 44349 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $44 million. That figure was $50 million in CMTL’s case. Allot Ltd. (NASDAQ:ALLT) is the most popular stock in this table. On the other hand SiTime Corporation (NASDAQ:SITM) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks Comtech Telecommunications Corp. (NASDAQ:CMTL) is more popular among hedge funds. 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 returned 13.4% in 2020 through June 22nd but still managed to beat the market by 15.9 percentage points. Hedge funds were also right about betting on CMTL as the stock returned 26.8% so far in Q2 (through June 22nd) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
