Billionaire hedge fund managers such as Steve Cohen and Stan Druckenmiller can generate millions or even billions of dollars every year by pinning down high-potential small-cap stocks and pouring cash into these candidates. Small-cap stocks are overlooked by most investors, brokerage houses, and financial services hubs, while the unlimited research abilities of the big players within the hedge fund industry can easily identify the undervalued and high-potential stocks that reside the ignored corners of equity markets. There are numerous small-cap stocks that have turned out to be great winners, which is one of the main reasons the Insider Monkey team pays close attention to the hedge fund activity in relation to these stocks.
Allied Motion Technologies, Inc. (NASDAQ:AMOT) investors should pay attention to an increase in enthusiasm from smart money of late. AMOT was in 14 hedge funds’ portfolios at the end of the third quarter of 2018. There were 13 hedge funds in our database with AMOT positions at the end of the previous quarter. Our calculations also showed that amot isn’t among the 30 most popular stocks among hedge funds.
If you’d ask most market participants, hedge funds are viewed as unimportant, old investment vehicles of yesteryear. While there are more than 8,000 funds in operation at the moment, Our experts look at the top tier of this club, about 700 funds. Most estimates calculate that this group of people watch over most of all hedge funds’ total capital, and by tracking their highest performing stock picks, Insider Monkey has identified numerous investment strategies that have historically surpassed Mr. Market. Insider Monkey’s flagship hedge fund strategy defeated the S&P 500 index by 6 percentage points a year 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 24% since February 2017 (through December 3rd) even though the market was up nearly 23% during the same period. We just shared a list of 11 short targets in our latest quarterly update.
Let’s analyze the recent hedge fund action surrounding Allied Motion Technologies, Inc. (NASDAQ:AMOT).
Hedge fund activity in Allied Motion Technologies, Inc. (NASDAQ:AMOT)
At Q3’s end, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 8% from one quarter earlier. On the other hand, there were a total of 8 hedge funds with a bullish position in AMOT at the beginning of this year. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).
The largest stake in Allied Motion Technologies, Inc. (NASDAQ:AMOT) was held by Renaissance Technologies, which reported holding $19.8 million worth of stock at the end of September. It was followed by G2 Investment Partners Management with a $9.1 million position. Other investors bullish on the company included GLG Partners, Algert Coldiron Investors, and Millennium Management.
With a general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Navellier & Associates, managed by Louis Navellier, created the biggest position in Allied Motion Technologies, Inc. (NASDAQ:AMOT). Navellier & Associates had $1.1 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made a $0.4 million investment in the stock during the quarter. The only other fund with a brand new AMOT position is Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Allied Motion Technologies, Inc. (NASDAQ:AMOT) but similarly valued. We will take a look at Blackrock MuniHoldings Californ (NYSE:MUC), Stemline Therapeutics Inc (NASDAQ:STML), Sorrentto Therapeutics Inc (NASDAQ:SRNE), and AG Mortgage Investment Trust Inc (NYSE:MITT). All of these stocks’ market caps are similar to AMOT’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MUC | 1 | 620 | -2 |
| STML | 17 | 154466 | 1 |
| SRNE | 10 | 9288 | 1 |
| MITT | 8 | 21119 | 0 |
| Average | 9 | 46373 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 9 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $44 million in AMOT’s case. Stemline Therapeutics Inc (NASDAQ:STML) is the most popular stock in this table. On the other hand Blackrock MuniHoldings Californ (NYSE:MUC) is the least popular one with only 1 bullish hedge fund positions. Allied Motion Technologies, Inc. (NASDAQ:AMOT) 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. In this regard STML might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.
