A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended June 30th, so let’s proceed with the discussion of the hedge fund sentiment on Natus Medical Inc (NASDAQ:NTUS).
Natus Medical Inc (NASDAQ:NTUS) shareholders have witnessed an increase in enthusiasm from smart money of late. Natus Medical Inc (NASDAQ:NTUS) was in 21 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 24. Our calculations also showed that NTUS isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Michael Gelband of ExodusPoint Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV 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 we’re going to take a glance at the recent hedge fund action encompassing Natus Medical Inc (NASDAQ:NTUS).
Do Hedge Funds Think NTUS Is A Good Stock To Buy Now?
At Q2’s end, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 5% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in NTUS over the last 24 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Impax Asset Management was the largest shareholder of Natus Medical Inc (NASDAQ:NTUS), with a stake worth $14.4 million reported as of the end of June. Trailing Impax Asset Management was Renaissance Technologies, which amassed a stake valued at $13.6 million. Arrowstreet Capital, Fisher Asset Management, and Diamond Hill Capital 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 Rutabaga Capital Management allocated the biggest weight to Natus Medical Inc (NASDAQ:NTUS), around 1.31% of its 13F portfolio. Zebra Capital Management is also relatively very bullish on the stock, earmarking 0.75 percent of its 13F equity portfolio to NTUS.
With a general bullishness amongst the heavyweights, some big names have been driving this bullishness. Millennium Management, managed by Israel Englander, established the largest call position in Natus Medical Inc (NASDAQ:NTUS). Millennium Management had $1.6 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also initiated a $0.9 million position during the quarter. The other funds with new positions in the stock are Ray Dalio’s Bridgewater Associates, Peter Algert’s Algert Global, and Ken Griffin’s Citadel Investment Group.
Let’s also examine hedge fund activity in other stocks similar to Natus Medical Inc (NASDAQ:NTUS). These stocks are Lakeland Bancorp, Inc. (NASDAQ:LBAI), Warrior Met Coal Inc. (NYSE:HCC), Travere Therapeutics, Inc. (NASDAQ:TVTX), HealthStream, Inc. (NASDAQ:HSTM), Global Partners LP (NYSE:GLP), OneSpaWorld Holdings Limited (NASDAQ:OSW), and Forrester Research, Inc. (NASDAQ:FORR). This group of stocks’ market valuations match NTUS’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LBAI | 13 | 32848 | -1 |
| HCC | 21 | 130281 | -5 |
| TVTX | 25 | 352352 | -2 |
| HSTM | 14 | 67764 | 0 |
| GLP | 2 | 9146 | 0 |
| OSW | 12 | 155686 | 1 |
| FORR | 8 | 112838 | 1 |
| Average | 13.6 | 122988 | -0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.6 hedge funds with bullish positions and the average amount invested in these stocks was $123 million. That figure was $86 million in NTUS’s case. Travere Therapeutics, Inc. (NASDAQ:TVTX) is the most popular stock in this table. On the other hand Global Partners LP (NYSE:GLP) is the least popular one with only 2 bullish hedge fund positions. Natus Medical Inc (NASDAQ:NTUS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for NTUS is 73.6. 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 positive signal but 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 24% in 2021 through October 22nd and beat the market again by 1.6 percentage points. Unfortunately NTUS wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on NTUS were disappointed as the stock returned -5.7% since the end of June (through 10/22) 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 many of these stocks already outperformed the market since 2019.
Follow Natus Medical Inc (NASDAQ:NTUS)
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Disclosure: None. This article was originally published at Insider Monkey.
