Is InnerWorkings, Inc. (NASDAQ:INWK) a good stock to buy right now? We at Insider Monkey like to examine what billionaires and hedge funds think of a company before doing days of research on it. Given their 2 and 20 payment structure, hedge funds have more resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also have numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
InnerWorkings, Inc. has experienced a decrease in enthusiasm from smart money lately. INWK was in 11 hedge funds’ portfolios at the end of the third quarter of 2015. There were 12 hedge funds in our database with INWK positions at the end of the previous quarter. At the end of this article we will also compare INWK to other stocks including Alico, Inc. (NASDAQ:ALCO), InterNAP Network Services (NASDAQ:INAP), and Village Super Market, Inc. (NASDAQ:VLGEA) to get a better sense of its popularity.
Follow Innerworkings Inc (NASDAQ:INWK)
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In the financial world, there are a lot of indicators stock traders have at their disposal to assess stocks. A couple of the most under-the-radar indicators are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the top picks of the best investment managers can outpace the market by a healthy margin (see the details here).
Now, let’s go over the fresh action surrounding InnerWorkings, Inc. (NASDAQ:INWK).
How have hedgies been trading InnerWorkings, Inc. (NASDAQ:INWK)?
Heading into Q4, a total of 11 of the hedge funds tracked by Insider Monkey were long this stock, a decline of 8% from the previous quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Sagard Capital Partners Management Corp, managed by Dan Friedberg, holds the most valuable position in InnerWorkings, Inc. (NASDAQ:INWK). The fund has a $46.7 million position in the stock, comprising 16.3% of its 13F portfolio. Sitting at the No. 2 spot is Peter Schliemann of Rutabaga Capital Management, with a $21.4 million position; 2.6% of its 13F portfolio is allocated to the company. Other hedge funds and institutional investors that hold long positions consist of David Park’s Headlands Capital, Tom Henwood’s OMT Capital Management and D. E. Shaw’s D E Shaw.
Due to the fact that InnerWorkings, Inc. (NASDAQ:INWK) has witnessed falling interest from the aggregate hedge fund industry, logic holds that there were a few hedge funds that elected to cut their full holdings in the third quarter. It’s worth mentioning that Israel Englander’s Millennium Management cut the biggest investment of the “upper crust” of funds tracked by Insider Monkey, valued at an estimated $0.1 million in stock. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also dropped its stock, about $0.1 million worth of shares. These moves are intriguing to say the least, as total hedge fund interest fell by 1 fund in the third quarter.
Let’s now take a look at hedge fund activity in other stocks similar to InnerWorkings, Inc. (NASDAQ:INWK). We will take a look at Alico, Inc. (NASDAQ:ALCO), InterNAP Network Services (NASDAQ:INAP), Village Super Market, Inc. (NASDAQ:VLGEA), and Independent Bank Corporation(MI) (NASDAQ:IBCP). This group of stocks’ market values are closest to INWK’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ALCO | 8 | 60391 | 1 |
| INAP | 10 | 100835 | 0 |
| VLGEA | 6 | 39826 | -1 |
| IBCP | 12 | 57440 | 2 |
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 $65 million. That figure was $88 million in INWK’s case. Independent Bank Corporation(MI) (NASDAQ:IBCP) is the most popular stock in this table. On the other hand Village Super Market, Inc. (NASDAQ:VLGEA) is the least popular one with only 6 bullish hedge fund positions. While InnerWorkings, Inc. (NASDAQ:INWK) is not the most popular stock in this group, 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 IBCP might be a better candidate to consider a long position.
