Is Boxlight Corporation (NASDAQ:BOXL) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.
Is Boxlight Corporation (NASDAQ:BOXL) a buy here? Hedge funds were in a pessimistic mood. The number of long hedge fund bets shrunk by 1 lately. Boxlight Corporation (NASDAQ:BOXL) was in 3 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 4. Our calculations also showed that BOXL isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Keith Rosenbloom of Cruiser Capital Advisors
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $30 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind let’s take a gander at the fresh hedge fund action surrounding Boxlight Corporation (NASDAQ:BOXL).
Do Hedge Funds Think BOXL Is A Good Stock To Buy Now?
At Q1’s end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -25% from the previous quarter. On the other hand, there were a total of 1 hedge funds with a bullish position in BOXL a year ago. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
Among these funds, Citadel Investment Group held the most valuable stake in Boxlight Corporation (NASDAQ:BOXL), which was worth $0.3 million at the end of the fourth quarter. On the second spot was Renaissance Technologies which amassed $0.3 million worth of shares. Cruiser Capital Advisors was also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Cruiser Capital Advisors allocated the biggest weight to Boxlight Corporation (NASDAQ:BOXL), around 0.06% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, designating 0.0004 percent of its 13F equity portfolio to BOXL.
Due to the fact that Boxlight Corporation (NASDAQ:BOXL) has witnessed falling interest from the aggregate hedge fund industry, logic holds that there exists a select few hedge funds that elected to cut their positions entirely heading into Q2. Intriguingly, Nick Thakore’s Diametric Capital dumped the largest stake of the “upper crust” of funds tracked by Insider Monkey, totaling about $0.1 million in stock. Gavin Saitowitz and Cisco J. del Valle’s fund, Prelude Capital (previously Springbok Capital), also dropped its stock, about $0 million worth. These transactions are important to note, as total hedge fund interest was cut by 1 funds heading into Q2.
Let’s go over hedge fund activity in other stocks similar to Boxlight Corporation (NASDAQ:BOXL). These stocks are SELLAS Life Sciences Group, Inc. (NASDAQ:SLS), Phoenix New Media Ltd (NYSE:FENG), VAALCO Energy, Inc. (NYSE:EGY), PC Tel Inc (NASDAQ:PCTI), Cidara Therapeutics Inc (NASDAQ:CDTX), S&W Seed Company (NASDAQ:SANW), and Meten EdtechX Education Group Ltd. (NASDAQ:METX). This group of stocks’ market valuations are closest to BOXL’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SLS | 4 | 953 | 3 |
| FENG | 5 | 2684 | 0 |
| EGY | 6 | 11733 | -1 |
| PCTI | 10 | 27772 | 0 |
| CDTX | 6 | 13667 | 0 |
| SANW | 7 | 78119 | 1 |
| METX | 2 | 772 | -1 |
| Average | 5.7 | 19386 | 0.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.7 hedge funds with bullish positions and the average amount invested in these stocks was $19 million. That figure was $1 million in BOXL’s case. PC Tel Inc (NASDAQ:PCTI) is the most popular stock in this table. On the other hand Meten EdtechX Education Group Ltd. (NASDAQ:METX) is the least popular one with only 2 bullish hedge fund positions. Boxlight Corporation (NASDAQ:BOXL) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for BOXL is 32.8. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th and surpassed the market again by 3.3 percentage points. Unfortunately BOXL wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); BOXL investors were disappointed as the stock returned -0.4% since the end of March (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.
Disclosure: None. This article was originally published at Insider Monkey.
