Hedge Funds Are Crazy About Vascular Solutions, Inc. (VASC)

There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Carl Icahn and George Soros think. Those hedge fund operators make billions of dollars each year by hiring the best and the brightest to do research on stocks, including small cap stocks that big brokerage houses simply don’t cover. Because of Carl Icahn and other successful funds’ exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze Vascular Solutions, Inc. (NASDAQ:VASC).

Vascular Solutions, Inc. (NASDAQ:VASC) has experienced an increase in activity from the world’s largest hedge funds lately. VASC was in 10 hedge funds’ portfolios at the end of the third quarter of 2016. There were 8 hedge funds in our database with VASC positions at the end of the previous quarter. At the end of this article we will also compare VASC to other stocks including Fox Factory Holding Corp (NASDAQ:FOXF), SPX Corporation (NYSE:SPXC), and Wingstop Inc (NASDAQ:WING) 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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What does the smart money think about Vascular Solutions, Inc. (NASDAQ:VASC)?

At Q3’s end, a total of 10 of the hedge funds tracked by Insider Monkey were long this stock, a gain of 25% from one quarter earlier. On the other hand, there were a total of 12 hedge funds with a bullish position in VASC at the beginning of this year. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Renaissance Technologies, one of the largest hedge funds in the world, holds the most valuable position in Vascular Solutions, Inc. (NASDAQ:VASC). Renaissance Technologies has a $15.8 million position in the stock. On Renaissance Technologies’ heels is GAMCO Investors, led by Mario Gabelli, which holds a $10 million position. Other hedge funds and institutional investors that hold long positions encompass Richard Driehaus’ Driehaus Capital, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Paul Hondros’ AlphaOne Capital Partners. We should note that none of these hedge funds are 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.

Consequently, specific money managers were breaking ground themselves. Citadel Investment Group, led by Ken Griffin, assembled the most outsized position in Vascular Solutions, Inc. (NASDAQ:VASC). Citadel Investment Group had $0.8 million invested in the company at the end of the quarter. Roger Ibbotson’s Zebra Capital Management also made a $0.4 million investment in the stock during the quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Vascular Solutions, Inc. (NASDAQ:VASC) but similarly valued. We will take a look at Fox Factory Holding Corp (NASDAQ:FOXF), SPX Corporation (NYSE:SPXC), Wingstop Inc (NASDAQ:WING), and ICF International Inc (NASDAQ:ICFI). This group of stocks’ market values match VASC’s market value.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $63 million. That figure was $44 million in VASC’s case. SPX Corporation (NYSE:SPXC) is the most popular stock in this table. On the other hand Fox Factory Holding Corp (NASDAQ:FOXF) is the least popular one with only 9 bullish hedge fund positions. Vascular Solutions, Inc. (NASDAQ:VASC) 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. In this regard SPXC might be a better candidate to consider taking a long position in.

Disclosure: None