Where Do Hedge Funds Stand On Kewaunee Scientific Corporation (KEQU)?

With the first-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the second quarter of 2021. One of these stocks was Kewaunee Scientific Corporation (NASDAQ:KEQU).

Kewaunee Scientific Corporation (NASDAQ:KEQU) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 3 hedge funds’ portfolios at the end of March. Our calculations also showed that KEQU isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). At the end of this article we will also compare KEQU to other stocks including Fuwei Films (Holdings) Co., Ltd (NASDAQ:FFHL), Siyata Mobile Inc. (NASDAQ:SYTA), and Staffing 360 Solutions, Inc. (NASDAQ:STAF) to get a better sense of its popularity.

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 206.8% since March 2017 and outperformed the S&P 500 ETFs by more than 115 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

J. Carlo Cannell of Cannell Capital

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $26 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery 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. With all of this in mind we’re going to analyze the latest hedge fund action regarding Kewaunee Scientific Corporation (NASDAQ:KEQU).

Do Hedge Funds Think KEQU Is A Good Stock To Buy Now?

At Q1’s end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the fourth quarter of 2020. By comparison, 3 hedge funds held shares or bullish call options in KEQU a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, Minerva Advisors held the most valuable stake in Kewaunee Scientific Corporation (NASDAQ:KEQU), which was worth $1.5 million at the end of the fourth quarter. On the second spot was Renaissance Technologies which amassed $1.4 million worth of shares. Cannell Capital was 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 Minerva Advisors allocated the biggest weight to Kewaunee Scientific Corporation (NASDAQ:KEQU), around 0.84% of its 13F portfolio. Cannell Capital is also relatively very bullish on the stock, earmarking 0.02 percent of its 13F equity portfolio to KEQU.

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Kewaunee Scientific Corporation (NASDAQ:KEQU) but similarly valued. We will take a look at Fuwei Films (Holdings) Co., Ltd (NASDAQ:FFHL), Siyata Mobile Inc. (NASDAQ:SYTA), Staffing 360 Solutions, Inc. (NASDAQ:STAF), Evolving Systems Inc (NASDAQ:EVOL), Bonso Electronics International Inc. (NASDAQ:BNSO), Rocky Mountain Chocolate Factory, Inc. (NASDAQ:RMCF), and ADDvantage Technologies Group, Inc. (NASDAQ:AEY). This group of stocks’ market valuations are closest to KEQU’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 1.3 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $3 million in KEQU’s case. Evolving Systems Inc (NASDAQ:EVOL) is the most popular stock in this table. On the other hand Fuwei Films (Holdings) Co., Ltd (NASDAQ:FFHL) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Kewaunee Scientific Corporation (NASDAQ:KEQU) is more popular among hedge funds. Our overall hedge fund sentiment score for KEQU is 85. 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. 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 17.2% in 2021 through June 11th and still beat the market by 3.3 percentage points. Unfortunately KEQU wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on KEQU were disappointed as the stock returned -4.8% since the end of the first quarter (through 6/11) 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 most of these stocks already outperformed the market since 2019.

Disclosure: None. This article was originally published at Insider Monkey.

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