A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on QAD Inc. (NASDAQ:QADA).
QAD Inc. was in 11 hedge funds’ portfolios at the end of the third quarter of 2015. QADA shareholders have witnessed an increase in hedge fund sentiment lately. There were 10 hedge funds in our database with QADA positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Actua Corp (NASDAQ:ACTA), Intralinks Holdings Inc (NYSE:IL), and Vera Bradley, Inc. (NASDAQ:VRA) to gather more data points.
In the eyes of most shareholders, hedge funds are viewed as underperforming, old investment tools of yesteryear. While there are over 8000 funds trading at present, Our researchers look at the elite of this club, about 700 funds. These money managers control most of all hedge funds’ total capital, and by paying attention to their highest performing stock picks, Insider Monkey has identified a few investment strategies that have historically outstripped the broader indices. Insider Monkey’s small-cap hedge fund strategy defeated the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, let’s view the new action encompassing QAD Inc. (NASDAQ:QADA).
How are hedge funds trading QAD Inc. (NASDAQ:QADA)?
At Q3’s end, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 10% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Rutabaga Capital Management, managed by Peter Schliemann, holds the largest position in QAD Inc. (NASDAQ:QADA). The fund has an $11.5 million position in the stock, comprising 1.4% of its 13F portfolio. The second most bullish fund manager is Renaissance Technologies, managed by Jim Simons, which holds an $11.1 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other members of the smart money that are bullish consist of Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management, Charles Goldblum’s Hurley Capital and Chuck Royce’s Royce & Associates.
Consequently, specific money managers were leading the bulls’ herd. AQR Capital Management, managed by Cliff Asness, initiated the most outsized position in QAD Inc. (NASDAQ:QADA), having reported a $0.2 million investment in the company at the end of the quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as QAD Inc. (NASDAQ:QADA) but similarly valued. We will take a look at Actua Corp (NASDAQ:ACTA), Intralinks Holdings Inc (NYSE:IL), Vera Bradley, Inc. (NASDAQ:VRA), and Fidelity Southern Corporation (NASDAQ:LION). All of these stocks’ market caps are closest to QADA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ACTA | 8 | 6774 | 0 |
| IL | 26 | 125997 | 2 |
| VRA | 15 | 79421 | -1 |
| LION | 16 | 52711 | -1 |
As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $66 million. Intralinks Holdings Inc (NYSE:IL) is the most popular stock in this table. On the other hand Actua Corp (NASDAQ:ACTA) is the least popular one with only 8 bullish hedge fund positions. Although QAD Inc. (NASDAQ:QADA) is not the least popular stock in this group, with 11 top funds holding long positions, the amount invested in this stock stood at $46 million at the end of the quarter, significantly below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard IL might be a better candidate to consider a long position.
