The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge funds have been producing disappointing net returns in recent years, however that was partly due to the poor performance of small-cap stocks in general. Well, small-cap stocks finally turned the corner and have been beating the large-cap stocks by more than 10 percentage points over the last 5 months.This means the relevancy of hedge funds’ public filings became inarguable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Servicesource International Inc (NASDAQ:SREV).
Servicesource International Inc (NASDAQ:SREV) shares didn’t see a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 12 hedge funds’ portfolios at the end of the third quarter of 2016. 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 NextPoint Residential Trust Inc (NYSE:NXRT), ConforMIS Inc (NASDAQ:CFMS), and Medley Capital Corp (NYSE:MCC) to gather more data points.
Follow Concentrix Servicesource Inc. (NASDAQ:SREV)
Follow Concentrix Servicesource Inc. (NASDAQ:SREV)
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 view the latest action encompassing Servicesource International Inc (NASDAQ:SREV).
What does the smart money think about Servicesource International Inc (NASDAQ:SREV)?
At Q3’s end, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, flat from the second quarter of 2016. The graph below displays the number of hedge funds with bullish position in SREV over the last 5 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Robert G. Moses’s RGM Capital has the most valuable position in Servicesource International Inc (NASDAQ:SREV), worth close to $37 million, accounting for 4.2% of its total 13F portfolio. On RGM Capital’s heels is Harvest Capital Strategies, led by Joseph A. Jolson, which holds a $36.6 million position; 5.3% of its 13F portfolio is allocated to the stock. Other professional money managers that are bullish comprise Rishi Bajaj, Toby Symonds, and Steve Tesoriere’s Altai Capital, Phil Frohlich’s Prescott Group Capital Management and Renaissance Technologies, one of the largest hedge funds in the world. We should note that RGM Capital 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.
We view hedge fund activity in the stock unfavorable, as there were no hedge funds that initiated new positions, neither ones that decided to dump their holdings. There were, however, certain hedge funds that took steps to reduce their exposure to Servicesource International Inc (NASDAQ:SREV). Cannell Capital, managed by J. Carlo Cannell, cut its investment by 15% during the third quarter, while Ken Griffin’s Citadel Investment Group dumped 50% of its holding by the end of September.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Servicesource International Inc (NASDAQ:SREV) but similarly valued. These stocks are NextPoint Residential Trust Inc (NYSE:NXRT), ConforMIS Inc (NASDAQ:CFMS), Medley Capital Corp (NYSE:MCC), and Petmed Express Inc (NASDAQ:PETS). This group of stocks’ market caps are similar to SREV’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NXRT | 11 | 59174 | 1 |
| CFMS | 4 | 12486 | -1 |
| MCC | 4 | 4517 | 0 |
| PETS | 10 | 50583 | 0 |
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $32 million. That figure was $145 million in SREV’s case. NextPoint Residential Trust Inc (NYSE:NXRT) is the most popular stock in this table. On the other hand ConforMIS Inc (NASDAQ:CFMS) and Medley Capital Corp (NYSE:MCC) are the least popular ones with only 4 bullish hedge fund positions each. Compared to these stocks Servicesource International Inc (NASDAQ:SREV) 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.
