The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Atlanticus Holdings Corp (NASDAQ:ATLC) based on those filings.
Is Atlanticus Holdings Corp (NASDAQ:ATLC) the right investment to pursue these days? The best stock pickers are becoming more confident. The number of bullish hedge fund positions advanced by 2 in recent months. Our calculations also showed that ATLC 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 financial world there are plenty of gauges stock market investors have at their disposal to analyze stocks. Two of the less known gauges are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the best picks of the elite fund managers can outclass the S&P 500 by a very impressive margin (see the details here).
Chuck Royce of Royce & Associates
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. 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. With all of this in mind we’re going to take a look at the recent hedge fund action encompassing Atlanticus Holdings Corp (NASDAQ:ATLC).
How are hedge funds trading Atlanticus Holdings Corp (NASDAQ:ATLC)?
Heading into the second quarter of 2020, a total of 4 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 100% from the previous quarter. By comparison, 2 hedge funds held shares or bullish call options in ATLC 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.
When looking at the institutional investors followed by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the most valuable position in Atlanticus Holdings Corp (NASDAQ:ATLC). Citadel Investment Group has a $2.5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Renaissance Technologies, holding a $1.7 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining professional money managers with similar optimism contain Israel Englander’s Millennium Management, Chuck Royce’s Royce & Associates and . In terms of the portfolio weights assigned to each position Renaissance Technologies allocated the biggest weight to Atlanticus Holdings Corp (NASDAQ:ATLC), around 0.0016% of its 13F portfolio. Millennium Management is also relatively very bullish on the stock, dishing out 0.0013 percent of its 13F equity portfolio to ATLC.
With a general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Millennium Management, managed by Israel Englander, initiated the largest position in Atlanticus Holdings Corp (NASDAQ:ATLC). Millennium Management had $0.6 million invested in the company at the end of the quarter. Chuck Royce’s Royce & Associates also made a $0 million investment in the stock during the quarter.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Atlanticus Holdings Corp (NASDAQ:ATLC) but similarly valued. We will take a look at Kindred Biosciences Inc (NASDAQ:KIN), The Bank of Princeton (NASDAQ:BPRN), scPharmaceuticals Inc. (NASDAQ:SCPH), and Alpha Pro Tech, Ltd. (NYSE:APT). This group of stocks’ market valuations resemble ATLC’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| KIN | 7 | 45892 | 0 |
| BPRN | 3 | 11554 | 1 |
| SCPH | 6 | 61882 | 1 |
| APT | 5 | 15095 | 3 |
| Average | 5.25 | 33606 | 1.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.25 hedge funds with bullish positions and the average amount invested in these stocks was $34 million. That figure was $5 million in ATLC’s case. Kindred Biosciences Inc (NASDAQ:KIN) is the most popular stock in this table. On the other hand The Bank of Princeton (NASDAQ:BPRN) is the least popular one with only 3 bullish hedge fund positions. Atlanticus Holdings Corp (NASDAQ:ATLC) is not the least popular stock in this group but hedge fund interest is still below average. 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 gained 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. A small number of hedge funds were also right about betting on ATLC as the stock returned 46.2% during the second quarter and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
