The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 873 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of June 30th, 2021. What do these smart investors think about Resonant Inc. (NASDAQ:RESN)?
Resonant Inc. (NASDAQ:RESN) shareholders have witnessed an increase in hedge fund interest lately. Resonant Inc. (NASDAQ:RESN) was in 10 hedge funds’ portfolios at the end of June. The all time high for this statistic is 6. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that RESN isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Donald Sussman of Paloma Partners
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now we’re going to take a look at the recent hedge fund action surrounding Resonant Inc. (NASDAQ:RESN).
Do Hedge Funds Think RESN Is A Good Stock To Buy Now?
At second quarter’s end, a total of 10 of the hedge funds tracked by Insider Monkey were long this stock, a change of 67% from the first quarter of 2020. The graph below displays the number of hedge funds with bullish position in RESN over the last 24 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Millennium Management held the most valuable stake in Resonant Inc. (NASDAQ:RESN), which was worth $5.4 million at the end of the second quarter. On the second spot was Renaissance Technologies which amassed $1 million worth of shares. Two Sigma Advisors, Citadel Investment Group, and D E Shaw 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 PDT Partners allocated the biggest weight to Resonant Inc. (NASDAQ:RESN), around 0.01% of its 13F portfolio. Paloma Partners is also relatively very bullish on the stock, setting aside 0.0033 percent of its 13F equity portfolio to RESN.
Now, key money managers were leading the bulls’ herd. D E Shaw, managed by D. E. Shaw, created the most outsized position in Resonant Inc. (NASDAQ:RESN). D E Shaw had $0.3 million invested in the company at the end of the quarter. Donald Sussman’s Paloma Partners also initiated a $0.2 million position during the quarter. The following funds were also among the new RESN investors: Michael Gelband’s ExodusPoint Capital, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners, and Paul Marshall and Ian Wace’s Marshall Wace LLP.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Resonant Inc. (NASDAQ:RESN) but similarly valued. These stocks are Ucommune International Ltd (NASDAQ:UK), Takung Art Co., Ltd. (NYSE:TKAT), Lannett Company, Inc. (NYSE:LCI), Neptune Wellness Solutions Inc (NASDAQ:NEPT), Savara, Inc. (NASDAQ:SVRA), Aptinyx Inc. (NASDAQ:APTX), and Broadway Financial Corporation (NASDAQ:BYFC). This group of stocks’ market values resemble RESN’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| UK | 3 | 298 | -1 |
| TKAT | 1 | 334 | 0 |
| LCI | 14 | 26503 | 4 |
| NEPT | 4 | 15174 | 0 |
| SVRA | 12 | 28938 | 2 |
| APTX | 9 | 28817 | 1 |
| BYFC | 3 | 2243 | 0 |
| Average | 6.6 | 14615 | 0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.6 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $8 million in RESN’s case. Lannett Company, Inc. (NYSE:LCI) is the most popular stock in this table. On the other hand Takung Art Co., Ltd. (NYSE:TKAT) is the least popular one with only 1 bullish hedge fund positions. Resonant Inc. (NASDAQ:RESN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for RESN is 73.6. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 25.7% in 2021 through September 27th and beat the market again by 6.2 percentage points. Unfortunately RESN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on RESN were disappointed as the stock returned -13.7% since the end of June (through 9/27) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
Follow Resonant Inc (NASDAQ:RESN)
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Disclosure: None. This article was originally published at Insider Monkey.
