Before we spend countless hours researching a company, we’d like to analyze what insiders, hedge funds and billionaire investors think of the stock first. We would like to do so because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Attunity Ltd (NASDAQ:ATTU).
Attunity Ltd (NASDAQ:ATTU) was in 17 hedge funds’ portfolios at the end of December. ATTU investors should pay attention to an increase in hedge fund interest in recent months. There were 13 hedge funds in our database with ATTU holdings at the end of the previous quarter. Our calculations also showed that ATTU isn’t among the 30 most popular stocks among hedge funds.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? 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 market by 32 percentage points since May 2014 through March 12, 2019 (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. Even if you aren’t comfortable with shorting stocks, you should at least avoid initiating long positions in our short portfolio.
We’re going to review the fresh hedge fund action regarding Attunity Ltd (NASDAQ:ATTU).
How are hedge funds trading Attunity Ltd (NASDAQ:ATTU)?
Heading into the first quarter of 2019, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 31% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards ATTU over the last 14 quarters. With hedgies’ sentiment swirling, there exists a few notable hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Josh Goldberg’s G2 Investment Partners Management has the largest position in Attunity Ltd (NASDAQ:ATTU), worth close to $20.2 million, amounting to 8.4% of its total 13F portfolio. Sitting at the No. 2 spot is David Atterbury of Whetstone Capital Advisors, with a $12.8 million position; 7.4% of its 13F portfolio is allocated to the stock. Some other peers that are bullish encompass George McCabe’s Portolan Capital Management, Chuck Royce’s Royce & Associates and Phil Frohlich’s Prescott Group Capital Management.
Now, key hedge funds have jumped into Attunity Ltd (NASDAQ:ATTU) headfirst. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the most valuable position in Attunity Ltd (NASDAQ:ATTU). Marshall Wace LLP had $3.9 million invested in the company at the end of the quarter. Richard Driehaus’s Driehaus Capital also initiated a $0.9 million position during the quarter. The other funds with brand new ATTU positions are Brian C. Freckmann’s Lyon Street Capital, Ken Griffin’s Citadel Investment Group, and Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Attunity Ltd (NASDAQ:ATTU) but similarly valued. These stocks are U.S. Well Services, Inc. (NASDAQ:USWS), Unifi, Inc. (NYSE:UFI), Axonics Modulation Technologies, Inc. (NASDAQ:AXNX), and Pennsylvania Real Estate Investment Trust (NYSE:PEI). All of these stocks’ market caps match ATTU’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| USWS | 14 | 32349 | -1 |
| UFI | 10 | 80864 | -4 |
| AXNX | 10 | 66177 | 10 |
| PEI | 15 | 37056 | 1 |
| Average | 12.25 | 54112 | 1.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was $85 million in ATTU’s case. Pennsylvania Real Estate Investment Trust (NYSE:PEI) is the most popular stock in this table. On the other hand Unifi, Inc. (NYSE:UFI) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Attunity Ltd (NASDAQ:ATTU) is more popular among hedge funds. 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. Hedge funds were also right about betting on ATTU, though not to the same extent, as the stock returned 18.9% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
