Is Intralinks Holdings Inc (IL) a Good Stock to Buy Right Now?

Hedge funds and other investment firms run by legendary investors like Israel Englander and Ray Dalio are entrusted to manage billions of dollars of accredited investors’ money because they are without peer in the resources they use to identify the best investments for their chosen investment horizon. Moreover, they are more willing to invest a greater amount of their resources in small-cap stocks than big brokerage houses, and this is often where they generate their outperformance, which is why we pay particular attention to their best ideas in this space.

Let’s take a closer look at Intralinks Holdings Inc (NYSE:IL), which registered a slight decrease in hedge fund sentiment recently. More specifically, during the third quarter, the number of investors in our database bullish on the company inched down by one to 23. At the end of this article we will also compare IL to other stocks including Alon USA Energy, Inc. (NYSE:ALJ), Natera Inc (NASDAQ:NTRA), and John B. Sanfilippo & Son, Inc. (NASDAQ:JBSS) to get a better sense of its popularity.

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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Now, we’re going to take a peek at the recent action surrounding Intralinks Holdings Inc (NYSE:IL).

What does the smart money think about Intralinks Holdings Inc (NYSE:IL)?

At the end of September, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, down by 4% over the quarter. By comparison, 25 hedge funds held shares or bullish call options in IL heading into this year. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Jim Simons’ Renaissance Technologies holds the number one position in Intralinks Holdings Inc (NYSE:IL). Renaissance Technologies has a $27.7 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Freshford Capital Management, led by Michael Doheny, which holds a $27.7 million position; the fund has 8.7% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish include Joshua Nash’s Ulysses Management, Peter S. Park’s Park West Asset Management, and J. Carlo Cannell’s Cannell Capital. We should note that Ulysses Management is 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.

Seeing as Intralinks Holdings Inc (NYSE:IL) has witnessed a decline in interest from hedge fund managers, logic holds that there was a specific group of funds that elected to cut their full holdings last quarter. Intriguingly, Jeffrey Moskowitz’s Harvey Partners cashed in the biggest position of all the investors tracked by Insider Monkey, totaling an estimated $1.5 million in stock, and Matthew Hulsizer’s PEAK6 Capital Management was right behind this move, as the fund dumped about $0.1 million worth of shares.

Let’s now take a look at hedge fund activity in other stocks similar to Intralinks Holdings Inc (NYSE:IL). We will take a look at Alon USA Energy, Inc. (NYSE:ALJ), Natera Inc (NASDAQ:NTRA), John B. Sanfilippo & Son, Inc. (NASDAQ:JBSS), and Middlesex Water Company (NASDAQ:MSEX). All of these stocks’ market caps are closest to IL’s market cap.

As you can see these stocks had an average of 13 funds with bullish positions and the average amount invested in these stocks was $55 million, which is lower than the $152 million figure in IL’s case. Alon USA Energy, Inc. (NYSE:ALJ) is the most popular stock in this table. On the other hand Middlesex Water Company (NASDAQ:MSEX) is the least popular one with only seven bullish hedge fund positions. Compared to these stocks Intralinks Holdings Inc (NYSE:IL) 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