We can judge whether Boingo Wireless Inc (NASDAQ:WIFI) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market when we factor in known risk factors.
Is Boingo Wireless Inc (NASDAQ:WIFI) a bargain? Investors who are in the know are betting on the stock. The number of bullish hedge fund positions inched up by 1 in recent months. Our calculations also showed that wifi isn’t among the 30 most popular stocks among hedge funds. WIFI was in 18 hedge funds’ portfolios at the end of December. There were 17 hedge funds in our database with WIFI positions at the end of the previous quarter.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Let’s check out the recent hedge fund action encompassing Boingo Wireless Inc (NASDAQ:WIFI).
What have hedge funds been doing with Boingo Wireless Inc (NASDAQ:WIFI)?
Heading into the first quarter of 2019, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 6% from the previous quarter. The graph below displays the number of hedge funds with bullish position in WIFI over the last 14 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Renaissance Technologies was the largest shareholder of Boingo Wireless Inc (NASDAQ:WIFI), with a stake worth $60.9 million reported as of the end of December. Trailing Renaissance Technologies was Daruma Asset Management, which amassed a stake valued at $21.2 million. Two Sigma Advisors, Portolan Capital Management, and G2 Investment Partners Management were also very fond of the stock, giving the stock large weights in their portfolios.
As industrywide interest jumped, key money managers have been driving this bullishness. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the biggest position in Boingo Wireless Inc (NASDAQ:WIFI). Marshall Wace LLP had $4.7 million invested in the company at the end of the quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Boingo Wireless Inc (NASDAQ:WIFI) but similarly valued. We will take a look at Carbonite Inc (NASDAQ:CARB), ARMOUR Residential REIT, Inc. (NYSE:ARR), Northern Oil & Gas, Inc. (NYSE:NOG), and Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA). This group of stocks’ market caps resemble WIFI’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CARB | 16 | 108510 | -1 |
| ARR | 5 | 12194 | 2 |
| NOG | 16 | 103063 | -1 |
| MNTA | 20 | 195727 | 2 |
| Average | 14.25 | 104874 | 0.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.25 hedge funds with bullish positions and the average amount invested in these stocks was $105 million. That figure was $126 million in WIFI’s case. Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA) is the most popular stock in this table. On the other hand ARMOUR Residential REIT, Inc. (NYSE:ARR) is the least popular one with only 5 bullish hedge fund positions. Boingo Wireless Inc (NASDAQ:WIFI) is not the most popular stock in this group but hedge fund interest is still above average. 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 WIFI, though not to the same extent, as the stock returned 17.5% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
