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 fund investors endured a torrid quarter, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Wix.Com Ltd (NASDAQ:WIX).
Hedge fund interest in Wix.Com Ltd (NASDAQ:WIX) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare WIX to other stocks, including New Media Investment Group Inc (NYSE:NEWM), Customers Bancorp Inc (NASDAQ:CUBI), and HealthStream, Inc. (NASDAQ:HSTM) to get a better sense of its popularity.
If you’d ask most stock holders, hedge funds are assumed to be worthless, outdated financial tools of years past. While there are greater than 8000 funds trading at the moment, Our researchers look at the elite of this group, around 700 funds. These money managers have their hands on bulk of all hedge funds’ total capital, and by keeping track of their highest performing picks, Insider Monkey has come up with various investment strategies that have historically defeated the market. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points annually for a decade in their back tests.
Keeping this in mind, we’re going to take a glance at the fresh action encompassing Wix.Com Ltd (NASDAQ:WIX).
How are hedge funds trading Wix.Com Ltd (NASDAQ:WIX)?
At the end of the third quarter, a total of 15 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged from the second quarter. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Robert Pitts’s Steadfast Capital Management has the number one position in Wix.Com Ltd (NASDAQ:WIX), worth close to $42.4 million, corresponding to 0.8% of its total 13F portfolio. The second most bullish fund manager is George Soros’ Soros Fund Management, holding an estimated $14.5 million stake; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining peers that hold long positions comprise Jim Simons’s Renaissance Technologies, George McCabe’s Portolan Capital Management and Steve Cohen’s Point72 Asset Management.
Due to the fact that Wix.Com Ltd (NASDAQ:WIX) has faced declining sentiment from the smart money, it’s safe to say that there is a sect of hedge funds that elected to cut their full holdings by the end of the third quarter. At the top of the heap, Alex Sacerdote’s Whale Rock Capital Management cut the biggest position of the 700 funds monitored by Insider Monkey, totaling $18.8 million in stock, and Josh Goldberg’s G2 Investment Partners Management was right behind this move, as the fund said goodbye to about $1.8 million worth of WIX shares. These transactions are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Wix.Com Ltd (NASDAQ:WIX) but similarly valued. We will take a look at New Media Investment Group Inc (NYSE:NEWM), Customers Bancorp Inc (NASDAQ:CUBI), HealthStream, Inc. (NASDAQ:HSTM), and IntelliPharmaCeutics International Inc. (TSE:I). All of these stocks’ market caps match WIX’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NEWM | 22 | 112314 | -2 |
| CUBI | 9 | 34867 | 1 |
| HSTM | 15 | 32179 | 1 |
| I | 11 | 49121 | 0 |
As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $57 million. That figure was $81 million in WIX’s case. New Media Investment Group Inc (NYSE:NEWM) is the most popular stock in this table, while Customers Bancorp Inc (NASDAQ:CUBI) is the laggard with only 9 bullish hedge fund positions. Wix.Com Ltd (NASDAQ:WIX) is not the most popular stock in this group, but hedge fund interest is still above average. While we treat this as a slightly positive signal, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard NEWM might be a better candidate to consider a long position.
