The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards WidePoint Corporation (NYSE:WYY).
WidePoint Corporation (NYSE:WYY) shareholders have witnessed an increase in enthusiasm from smart money recently. Our calculations also showed that WYY isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
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’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the Russell 2000 ETFs by 40 percentage points since May 2014 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.8% through November 21, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Ken Griffin of Citadel Investment Group
We leave no stone unturned when looking for the next great investment idea. For example Discover is offering this insane cashback card, so we look into shorting the stock. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We even check out this option genius’ weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager’s investor letter and the stock already gained 20 percent. Now we’re going to take a look at the latest hedge fund action encompassing WidePoint Corporation (NYSE:WYY).
Hedge fund activity in WidePoint Corporation (NYSE:WYY)
At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of 50% from the previous quarter. On the other hand, there were a total of 2 hedge funds with a bullish position in WYY a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
More specifically, Nokomis Capital was the largest shareholder of WidePoint Corporation (NYSE:WYY), with a stake worth $4 million reported as of the end of September. Trailing Nokomis Capital was Renaissance Technologies, which amassed a stake valued at $0.4 million. Diametric Capital, Springbok Capital, and Citadel Investment Group 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 Nokomis Capital allocated the biggest weight to WidePoint Corporation (NYSE:WYY), around 0.87% of its 13F portfolio. Diametric Capital is also relatively very bullish on the stock, setting aside 0.06 percent of its 13F equity portfolio to WYY.
Now, key hedge funds have been driving this bullishness. Citadel Investment Group, managed by Ken Griffin, created the largest position in WidePoint Corporation (NYSE:WYY). Citadel Investment Group had $0 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $0 million investment in the stock during the quarter.
Let’s now take a look at hedge fund activity in other stocks similar to WidePoint Corporation (NYSE:WYY). These stocks are Aptevo Therapeutics Inc. (NASDAQ:APVO), Future FinTech Group Inc. (NASDAQ:FTFT), ReTo Eco-Solutions, Inc. (NASDAQ:RETO), and Golden Minerals Company (NYSE:AUMN). This group of stocks’ market values resemble WYY’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| APVO | 7 | 3557 | 0 |
| FTFT | 1 | 21 | 0 |
| RETO | 1 | 23 | -1 |
| AUMN | 1 | 35 | -1 |
| Average | 2.5 | 909 | -0.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.5 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $5 million in WYY’s case. Aptevo Therapeutics Inc. (NASDAQ:APVO) is the most popular stock in this table. On the other hand Future FinTech Group Inc. (NASDAQ:FTFT) is the least popular one with only 1 bullish hedge fund positions. WidePoint Corporation (NYSE:WYY) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Hedge funds were also right about betting on WYY as the stock returned 19.4% during the fourth quarter (through the end of November) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.