Hedge funds are not perfect. They have their bad picks just like everyone else. Micron, a stock hedge funds have loved, lost 50% during the last 12 months ending in October 30. Although hedge funds are not perfect, their consensus picks do deliver solid returns, however. Our data show the top 30 S&P 500 stocks among hedge funds at the end of September 2014 yielded an average return of 9.5% in the same time period, vs. a gain of 5.2% for the S&P 500 Index. Because hedge funds have a lot of resources and their consensus picks do well, we pay attention to what they think. In this article, we analyze what the elite funds think of Alpha Pro Tech, Ltd. (NYSEMKT:APT).
Alpha Pro Tech, Ltd. (NYSEMKT:APT) investors should pay attention to an increase in support from the world’s most elite money managers of late. At the end of this article, we will compare Alpha Pro Tech, Ltd. (NYSEMKT:APT) to other stocks, including Qumu Corp (NASDAQ:QUMU), General Employment Enterprises, Inc. (NYSEMKT:JOB), and Roka Bioscience Inc (NASDAQ:ROKA) to get a better sense of its popularity.
Follow Alpha Pro Tech Ltd (NYSE:APT)
Follow Alpha Pro Tech Ltd (NYSE:APT)
In the 21st century investor’s toolkit, there are tons of tools market participants employ to analyze publicly traded companies. Two of the most innovative tools are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the best picks of the elite money managers can trounce the S&P 500 by a superb amount (see the details here).
Keeping this in mind, let’s review the fresh action surrounding Alpha Pro Tech, Ltd. (NYSEMKT:APT).
How are hedge funds trading Alpha Pro Tech, Ltd. (NYSEMKT:APT)?
Heading into Q4, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 33% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Renaissance Technologies has the number one position in Alpha Pro Tech, Ltd. (NYSEMKT:APT), worth close to $2.9 million, corresponding to less than 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Millennium Management, managed by Israel Englander, which holds a $33,000 position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Another hedge fund with a similar optimism encompass Ken Griffin’s Citadel Investment Group.
As one would reasonably expect, key hedge funds were breaking ground themselves. Apart from Millennium Management, Matthew Hulsizer’s PEAK6 Capital Management also initiated a CALL option position worth $20,000 during the quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Alpha Pro Tech, Ltd. (NYSEMKT:APT) but similarly valued. We will take a look at Qumu Corp (NASDAQ:QUMU), General Employment Enterprises, Inc. (NYSEMKT:JOB), Roka Bioscience Inc (NASDAQ:ROKA), and CASI Pharmaceuticals Inc (NASDAQ:CASI). All of these stocks’ market caps are similar to Alpha Pro Tech, Ltd. (NYSEMKT:APT)’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| QUMU | 4 | 9549 | 1 |
| JOB | 4 | 1096 | 3 |
| ROKA | 9 | 12306 | -1 |
| CASI | 4 | 287 | 2 |
As you can see, these stocks had an average of 5 hedge funds with bullish positions and the average amount invested in these stocks was $6 million. That figure was $3 million in Alpha Pro Tech, Ltd. (NYSEMKT:APT)’s case. Roka Bioscience Inc (NASDAQ:ROKA) is the most popular stock in this table. On the other hand, Qumu Corp (NASDAQ:QUMU) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks, Alpha Pro Tech, Ltd. (NYSEMKT:APT) is even less popular than Qumu Corp (NASDAQ:QUMU). Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case, more research is warranted.
