In this article we are going to use hedge fund sentiment as a tool and determine whether International Money Express, Inc. (NASDAQ:IMXI) is a good investment right now. We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
International Money Express, Inc. (NASDAQ:IMXI) was in 18 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic was previously 17. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. IMXI has experienced an increase in hedge fund interest lately. There were 16 hedge funds in our database with IMXI positions at the end of the fourth quarter. Our calculations also showed that IMXI isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
At the moment there are several tools shareholders put to use to value their holdings. A couple of the most under-the-radar tools are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the best picks of the top money managers can outclass their index-focused peers by a healthy margin (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .
Chuck Royce of Royce & Associates
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. 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 let’s take a gander at the fresh hedge fund action encompassing International Money Express, Inc. (NASDAQ:IMXI).
Do Hedge Funds Think IMXI Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 13% from one quarter earlier. By comparison, 9 hedge funds held shares or bullish call options in IMXI a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
More specifically, Royce & Associates was the largest shareholder of International Money Express, Inc. (NASDAQ:IMXI), with a stake worth $42.4 million reported as of the end of March. Trailing Royce & Associates was Steamboat Capital Partners, which amassed a stake valued at $34.1 million. Headlands Capital, Nantahala Capital Management, and Citadel Investment Group 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 Headlands Capital allocated the biggest weight to International Money Express, Inc. (NASDAQ:IMXI), around 23.04% of its 13F portfolio. Steamboat Capital Partners is also relatively very bullish on the stock, earmarking 10.06 percent of its 13F equity portfolio to IMXI.
As industrywide interest jumped, key money managers have been driving this bullishness. ExodusPoint Capital, managed by Michael Gelband, created the most valuable position in International Money Express, Inc. (NASDAQ:IMXI). ExodusPoint Capital had $0.3 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $0.2 million investment in the stock during the quarter. The only other fund with a new position in the stock is Peter Algert’s Algert Global.
Let’s check out hedge fund activity in other stocks similar to International Money Express, Inc. (NASDAQ:IMXI). These stocks are Tecnoglass Inc. (NASDAQ:TGLS), RCI Hospitality Holdings, Inc. (NASDAQ:RICK), WiMi Hologram Cloud Inc. (NASDAQ:WIMI), CRA International, Inc. (NASDAQ:CRAI), Evelo Biosciences, Inc. (NASDAQ:EVLO), Titan International Inc (NYSE:TWI), and Consolidated Communications Holdings Inc (NASDAQ:CNSL). This group of stocks’ market values resemble IMXI’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TGLS | 10 | 30288 | 4 |
| RICK | 10 | 108176 | 3 |
| WIMI | 6 | 7482 | 3 |
| CRAI | 14 | 59563 | -1 |
| EVLO | 5 | 3818 | 2 |
| TWI | 20 | 150026 | 1 |
| CNSL | 12 | 45296 | -1 |
| Average | 11 | 57807 | 1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $58 million. That figure was $134 million in IMXI’s case. Titan International Inc (NYSE:TWI) is the most popular stock in this table. On the other hand Evelo Biosciences, Inc. (NASDAQ:EVLO) is the least popular one with only 5 bullish hedge fund positions. International Money Express, Inc. (NASDAQ:IMXI) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for IMXI is 80.3. 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 28.5% in 2021 through July 23rd and beat the market again by 10.1 percentage points. Unfortunately IMXI wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on IMXI were disappointed as the stock returned 6.5% since the end of March (through 7/23) 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.
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Disclosure: None. This article was originally published at Insider Monkey.
