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. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of Qutoutiao Inc. (NASDAQ:QTT).
Is Qutoutiao Inc. (NASDAQ:QTT) a buy, sell, or hold? Investors who are in the know are becoming more confident. The number of bullish hedge fund bets advanced by 4 recently. Our calculations also showed that QTT 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 a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 101% since March 2017 and outperformed the S&P 500 ETFs by more than 58 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Ken Griffin of Citadel Investment Group
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to take a peek at the new hedge fund action encompassing Qutoutiao Inc. (NASDAQ:QTT).
What does smart money think about Qutoutiao Inc. (NASDAQ:QTT)?
At the end of the first quarter, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 80% from the previous quarter. The graph below displays the number of hedge funds with bullish position in QTT over the last 18 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Qutoutiao Inc. (NASDAQ:QTT) was held by Luminus Management, which reported holding $2.7 million worth of stock at the end of September. It was followed by D E Shaw with a $1.4 million position. Other investors bullish on the company included Ovata Capital Management, LMR Partners, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Ovata Capital Management allocated the biggest weight to Qutoutiao Inc. (NASDAQ:QTT), around 0.42% of its 13F portfolio. Luminus Management is also relatively very bullish on the stock, dishing out 0.28 percent of its 13F equity portfolio to QTT.
Now, specific money managers were leading the bulls’ herd. Luminus Management, managed by Jonathan Barrett and Paul Segal, assembled the biggest position in Qutoutiao Inc. (NASDAQ:QTT). Luminus Management had $2.7 million invested in the company at the end of the quarter. James Chen’s Ovata Capital Management also initiated a $0.6 million position during the quarter. The following funds were also among the new QTT investors: John Overdeck and David Siegel’s Two Sigma Advisors, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Greg Eisner’s Engineers Gate Manager.
Let’s also examine hedge fund activity in other stocks similar to Qutoutiao Inc. (NASDAQ:QTT). We will take a look at PDC Energy Inc (NASDAQ:PDCE), Oxford Industries, Inc. (NYSE:OXM), Bloom Energy Corporation (NYSE:BE), and Cara Therapeutics Inc (NASDAQ:CARA). This group of stocks’ market caps are closest to QTT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PDCE | 25 | 114905 | -7 |
| OXM | 12 | 27638 | 0 |
| BE | 10 | 44648 | -3 |
| CARA | 10 | 84410 | -7 |
| Average | 14.25 | 67900 | -4.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.25 hedge funds with bullish positions and the average amount invested in these stocks was $68 million. That figure was $5 million in QTT’s case. PDC Energy Inc (NASDAQ:PDCE) is the most popular stock in this table. On the other hand Bloom Energy Corporation (NYSE:BE) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Qutoutiao Inc. (NASDAQ:QTT) is even less popular than BE. 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 13.4% in 2020 through June 22nd but managed to beat the market by 15.9 percentage points. A small number of hedge funds were also right about betting on QTT, though not to the same extent, as the stock returned 25.1% during the second quarter (through June 22nd) and outperformed the market as well.
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Disclosure: None. This article was originally published at Insider Monkey.
