Where Do Hedge Funds Stand On Sonim Technologies, Inc. (SONM)?

Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Sonim Technologies, Inc. (NASDAQ:SONM), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Sonim Technologies, Inc. (NASDAQ:SONM) was in 5 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 11. SONM has seen a decrease in activity from the world’s largest hedge funds in recent months. There were 6 hedge funds in our database with SONM holdings at the end of December. Our calculations also showed that SONM isn’t among the 30 most popular stocks among hedge funds (click for Q1 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 115 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.

John Overdeck of Two Sigma Advisors

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 $23 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. Now we’re going to take a look at the fresh hedge fund action regarding Sonim Technologies, Inc. (NASDAQ:SONM).

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

At the end of the first quarter, a total of 5 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -17% from the fourth quarter of 2020. On the other hand, there were a total of 3 hedge funds with a bullish position in SONM a year ago. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Renaissance Technologies has the largest position in Sonim Technologies, Inc. (NASDAQ:SONM), worth close to $1.9 million, accounting for less than 0.1%% of its total 13F portfolio. The second most bullish fund manager is Harvey Partners, led by Jeffrey Moskowitz, holding a $1.3 million position; the fund has 0.9% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions encompass Mark Broach’s Manatuck Hill Partners, John Overdeck and David Siegel’s Two Sigma Advisors and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Harvey Partners allocated the biggest weight to Sonim Technologies, Inc. (NASDAQ:SONM), around 0.87% of its 13F portfolio. Manatuck Hill Partners is also relatively very bullish on the stock, dishing out 0.39 percent of its 13F equity portfolio to SONM.

Since Sonim Technologies, Inc. (NASDAQ:SONM) has faced bearish sentiment from the entirety of the hedge funds we track, we can see that there were a few funds who sold off their entire stakes by the end of the first quarter. Intriguingly, Brett Hendrickson’s Nokomis Capital said goodbye to the biggest investment of all the hedgies followed by Insider Monkey, totaling an estimated $0.5 million in stock. Israel Englander’s fund, Millennium Management, also dumped its stock, about $0 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 1 funds by the end of the first quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Sonim Technologies, Inc. (NASDAQ:SONM) but similarly valued. These stocks are Washington Prime Group Inc. (NYSE:WPG), Sunlands Technology Group (NYSE:STG), Applied DNA Sciences Inc (NASDAQ:APDN), Akers Biosciences Inc (NASDAQ:AKER), Kintara Therapeutics, Inc. (NASDAQ:KTRA), Sotherly Hotels Inc (NASDAQ:SOHO), and ARCA biopharma, Inc. (NASDAQ:ABIO). All of these stocks’ market caps resemble SONM’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 2.7 hedge funds with bullish positions and the average amount invested in these stocks was $1 million. That figure was $4 million in SONM’s case. Washington Prime Group Inc. (NYSE:WPG) is the most popular stock in this table. On the other hand Applied DNA Sciences Inc (NASDAQ:APDN) is the least popular one with only 1 bullish hedge fund positions. Sonim Technologies, Inc. (NASDAQ:SONM) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SONM is 57.6. 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 17.4% in 2021 through June 18th and beat the market again by 6.1 percentage points. Unfortunately SONM wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on SONM were disappointed as the stock returned -27.2% since the end of March (through 6/18) 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.

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

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