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 Jeff Ubben, George Soros and Carl Icahn 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 elite funds’ exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze ICF International Inc (NASDAQ:ICFI).
ICF International Inc (NASDAQ:ICFI) has seen an increase in support from the world’s most elite money managers in recent months. ICFI was in 17 hedge funds’ portfolios at the end of December. There were 16 hedge funds in our database with ICFI positions at the end of the previous quarter. Our calculations also showed that ICFI isn’t among the 30 most popular stocks among hedge funds.
If you’d ask most stock holders, hedge funds are viewed as underperforming, old investment tools of yesteryear. While there are over 8000 funds trading today, Our experts hone in on the masters of this club, about 750 funds. These hedge fund managers oversee the lion’s share of the hedge fund industry’s total capital, and by watching their highest performing picks, Insider Monkey has formulated various investment strategies that have historically beaten the S&P 500 index. Insider Monkey’s flagship hedge fund strategy beat the S&P 500 index by nearly 5 percentage points per annum since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 27.5% since February 2017 (through March 12th) even though the market was up nearly 25% during the same period. We just shared a list of 6 short targets in our latest quarterly update and they are already down an average of 6% in less than a month.
Cliff Asness of AQR Capital Management
We’re going to view the new hedge fund action surrounding ICF International Inc (NASDAQ:ICFI).
Hedge fund activity in ICF International Inc (NASDAQ:ICFI)
Heading into the first quarter of 2019, a total of 17 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 6% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in ICFI over the last 14 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, AQR Capital Management held the most valuable stake in ICF International Inc (NASDAQ:ICFI), which was worth $8.5 million at the end of the fourth quarter. On the second spot was Third Avenue Management which amassed $7.3 million worth of shares. Moreover, GLG Partners, D E Shaw, and Renaissance Technologies were also bullish on ICF International Inc (NASDAQ:ICFI), allocating a large percentage of their portfolios to this stock.
Consequently, specific money managers were breaking ground themselves. Weld Capital Management, managed by Minhua Zhang, established the biggest position in ICF International Inc (NASDAQ:ICFI). Weld Capital Management had $1 million invested in the company at the end of the quarter. Brandon Haley’s Holocene Advisors also initiated a $0.5 million position during the quarter.
Let’s go over hedge fund activity in other stocks similar to ICF International Inc (NASDAQ:ICFI). These stocks are Sunrun Inc (NASDAQ:RUN), SPX Corporation (NYSE:SPXC), MaxLinear, Inc. (NYSE:MXL), and Hortonworks Inc (NASDAQ:HDP). This group of stocks’ market caps resemble ICFI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RUN | 18 | 279156 | 10 |
| SPXC | 15 | 92681 | 4 |
| MXL | 5 | 19902 | 1 |
| HDP | 20 | 193198 | -7 |
| Average | 14.5 | 146234 | 2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $146 million. That figure was $36 million in ICFI’s case. Hortonworks Inc (NASDAQ:HDP) is the most popular stock in this table. On the other hand MaxLinear, Inc. (NYSE:MXL) is the least popular one with only 5 bullish hedge fund positions. ICF International Inc (NASDAQ:ICFI) is not the most popular stock in this group but hedge fund interest is still above average. 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 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately ICFI wasn’t nearly as popular as these 15 stock and hedge funds that were betting on ICFI were disappointed as the stock returned 15.2% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
