Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industry and media insiders on top of that. Individual investors can piggyback the hedge funds employing these talents and can benefit from their vast resources and knowledge in that way. We analyze quarterly 13F filings of nearly 750 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has the potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about The Hackett Group, Inc. (NASDAQ:HCKT).
The Hackett Group, Inc. (NASDAQ:HCKT) investors should be aware of an increase in hedge fund sentiment recently. Our calculations also showed that HCKT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
According to most traders, hedge funds are seen as unimportant, old investment vehicles of the past. While there are greater than 8000 funds with their doors open at present, Our researchers look at the aristocrats of this club, approximately 750 funds. It is estimated that this group of investors oversee most of the hedge fund industry’s total capital, and by following their unrivaled equity investments, Insider Monkey has uncovered numerous investment strategies that have historically exceeded Mr. Market. Insider Monkey’s flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points per annum since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .
Jim Simons of Renaissance Technologies
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We also rely on the best performing hedge funds‘ buy/sell signals. Let’s take a look at the latest hedge fund action encompassing The Hackett Group, Inc. (NASDAQ:HCKT).
How have hedgies been trading The Hackett Group, Inc. (NASDAQ:HCKT)?
At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 7% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in HCKT over the last 17 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Trigran Investments was the largest shareholder of The Hackett Group, Inc. (NASDAQ:HCKT), with a stake worth $27.2 million reported as of the end of September. Trailing Trigran Investments was Renaissance Technologies, which amassed a stake valued at $18.4 million. AQR Capital Management, Royce & Associates, and Millennium Management were 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 Trigran Investments allocated the biggest weight to The Hackett Group, Inc. (NASDAQ:HCKT), around 5.15% of its 13F portfolio. Zebra Capital Management is also relatively very bullish on the stock, setting aside 0.27 percent of its 13F equity portfolio to HCKT.
With a general bullishness amongst the heavyweights, key money managers have jumped into The Hackett Group, Inc. (NASDAQ:HCKT) headfirst. Zebra Capital Management, managed by Roger Ibbotson, created the most valuable position in The Hackett Group, Inc. (NASDAQ:HCKT). Zebra Capital Management had $0.3 million invested in the company at the end of the quarter. Peter Algert and Kevin Coldiron’s Algert Coldiron Investors also made a $0.2 million investment in the stock during the quarter.
Let’s go over hedge fund activity in other stocks similar to The Hackett Group, Inc. (NASDAQ:HCKT). We will take a look at Boingo Wireless Inc (NASDAQ:WIFI), AxoGen, Inc. (NASDAQ:AXGN), Aurinia Pharmaceuticals Inc (NASDAQ:AUPH), and Franklin Covey Co. (NYSE:FC). This group of stocks’ market values resemble HCKT’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WIFI | 13 | 42112 | -1 |
| AXGN | 13 | 62479 | -2 |
| AUPH | 13 | 87865 | 2 |
| FC | 10 | 21669 | 3 |
| Average | 12.25 | 53531 | 0.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was $73 million in HCKT’s case. Boingo Wireless Inc (NASDAQ:WIFI) is the most popular stock in this table. On the other hand Franklin Covey Co. (NYSE:FC) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks The Hackett Group, Inc. (NASDAQ:HCKT) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately HCKT wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on HCKT were disappointed as the stock returned -6.9% during the first two months of the fourth quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market in Q4.
Disclosure: None. This article was originally published at Insider Monkey.
