At Insider Monkey, we pore over the filings of nearly 866 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of March 31st. In this article, we will use that wealth of knowledge to determine whether or not Qumu Corp (NASDAQ:QUMU) makes for a good investment right now.
Is Qumu Corp (NASDAQ:QUMU) an attractive investment right now? The smart money was becoming more confident. The number of long hedge fund bets advanced by 1 recently. Qumu Corp (NASDAQ:QUMU) was in 6 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic was previously 5. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that QUMU isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.
Ken Griffin of Citadel Investment Group
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund owns nearly 40% of this $24 biotech stock and is trying to buy the rest for around $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. Keeping this in mind we’re going to check out the fresh hedge fund action encompassing Qumu Corp (NASDAQ:QUMU).
Do Hedge Funds Think QUMU Is A Good Stock To Buy Now?
At Q1’s end, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of 20% from the previous quarter. On the other hand, there were a total of 3 hedge funds with a bullish position in QUMU a year ago. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
Among these funds, Harbert Management held the most valuable stake in Qumu Corp (NASDAQ:QUMU), which was worth $9.2 million at the end of the fourth quarter. On the second spot was Renaissance Technologies which amassed $7.7 million worth of shares. Portolan Capital Management, Millennium Management, and Two Sigma Advisors 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 Harbert Management allocated the biggest weight to Qumu Corp (NASDAQ:QUMU), around 4.36% of its 13F portfolio. Portolan Capital Management is also relatively very bullish on the stock, dishing out 0.26 percent of its 13F equity portfolio to QUMU.
With a general bullishness amongst the heavyweights, some big names were leading the bulls’ herd. Portolan Capital Management, managed by George McCabe, assembled the most outsized position in Qumu Corp (NASDAQ:QUMU). Portolan Capital Management had $3.3 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $0.1 million position during the quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Qumu Corp (NASDAQ:QUMU) but similarly valued. We will take a look at Assertio Holdings Inc. (NASDAQ:ASRT), Performant Financial Corp (NASDAQ:PFMT), TDH Holdings, Inc. (NASDAQ:PETZ), OFS Capital Corp (NASDAQ:OFS), Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS), Prudential Bancorp, Inc. (NASDAQ:PBIP), and One Stop Systems, Inc. (NASDAQ:OSS). All of these stocks’ market caps resemble QUMU’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ASRT | 6 | 7725 | -1 |
| PFMT | 7 | 39551 | 4 |
| PETZ | 2 | 484 | 1 |
| OFS | 3 | 451 | 1 |
| CRVS | 11 | 50567 | 5 |
| PBIP | 1 | 5992 | -1 |
| OSS | 3 | 505 | 0 |
| Average | 4.7 | 15039 | 1.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 4.7 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $21 million in QUMU’s case. Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) is the most popular stock in this table. On the other hand Prudential Bancorp, Inc. (NASDAQ:PBIP) is the least popular one with only 1 bullish hedge fund positions. Qumu Corp (NASDAQ:QUMU) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for QUMU is 61. 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 19.3% in 2021 through June 25th and beat the market again by 4.8 percentage points. Unfortunately QUMU wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on QUMU were disappointed as the stock returned -54.1% since the end of March (through 6/25) 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.
