Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small cap stocks -especially when they are screened well- can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those successful funds in these small-cap stocks. In the following paragraphs, we will analyze FleetMatics Group PLC (NYSE:FLTX) from the perspective of those successful funds.
FleetMatics Group PLC (NYSE:FLTX) investors should pay attention to an increase in hedge fund interest in recent months. There were 27 hedge funds in our database with FLTX positions at the end of the third quarter, versus 11 funds at the end of June. 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 South Jersey Industries Inc (NYSE:SJI), Nektar Therapeutics (NASDAQ:NKTR), and Insulet Corporation (NASDAQ:PODD) to gather more data points.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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With all of this in mind, let’s review the latest action encompassing FleetMatics Group PLC (NYSE:FLTX).
Hedge fund activity in FleetMatics Group PLC (NYSE:FLTX)
During the third quarter, the number of funds tracked by Insider Monkey bullish on FleetMatics Group PLC (NYSE:FLTX) surged by 145% to 27. By comparison, 13 hedge funds held shares or bullish call options in FLTX heading into this year. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Alec Litowitz and Ross Laser’s Magnetar Capital holds the most valuable position in FleetMatics Group PLC (NYSE:FLTX). Magnetar Capital has a $99.3 million position in the stock, comprising 1.5% of its 13F portfolio. Sitting at the No. 2 spot is Robert Emil Zoellner’s Alpine Associates, with a $60.7 million position; 2.2% of its 13F portfolio is allocated to the stock. Remaining members of the smart money with similar optimism include Nick Niell’s Arrowgrass Capital Partners, Mario Gabelli’s GAMCO Investors, and Noam Gottesman’s GLG Partners. All these funds initiated stakes in FleetMatics during the third quarter. We should also note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
On the next page, we’ll take a look at how FleetMatics compares to other stocks with similar market caps.
Let’s also examine hedge fund activity in other stocks similar to FleetMatics Group PLC (NYSE:FLTX). These stocks are South Jersey Industries Inc (NYSE:SJI), Nektar Therapeutics (NASDAQ:NKTR), Insulet Corporation (NASDAQ:PODD), and HB Fuller Co (NYSE:FUL). All of these stocks’ market caps match FLTX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SJI | 8 | 12610 | 3 |
| NKTR | 17 | 222312 | 0 |
| PODD | 20 | 366551 | 0 |
| FUL | 15 | 110464 | -8 |
As you can see these stocks had an average of 15 funds with bullish positions and the average amount invested in these stocks was $178 million. That figure was $565 million in FLTX’s case. Insulet Corporation (NASDAQ:PODD) is the most popular stock in this table, while South Jersey Industries Inc (NYSE:SJI) is the least popular one with only eight bullish hedge fund positions. Compared to these stocks FleetMatics Group PLC (NYSE:FLTX) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
Disclosure: none
