The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Quotient Technology Inc (NYSE:QUOT).
Is QUOT a good stock to buy now? Quotient Technology Inc (NYSE:QUOT) has seen an increase in activity from the world’s largest hedge funds of late. Quotient Technology Inc (NYSE:QUOT) was in 15 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 21. There were 13 hedge funds in our database with QUOT holdings at the end of June. Our calculations also showed that QUOT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks). Video: Watch our video about the top 5 most popular hedge fund stocks.
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 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Minhua Zhang of Weld Capital Management
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. 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 website. With all of this in mind let’s take a glance at the new hedge fund action surrounding Quotient Technology Inc (NYSE:QUOT).
Do Hedge Funds Think QUOT Is A Good Stock To Buy Now?
At Q3’s end, a total of 15 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 15% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards QUOT over the last 21 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Cynthia Paul’s Lynrock Lake has the biggest position in Quotient Technology Inc (NYSE:QUOT), worth close to $151.9 million, corresponding to 11.3% of its total 13F portfolio. On Lynrock Lake’s heels is Trigran Investments, led by Douglas T. Granat, holding a $62.9 million position; 11.4% of its 13F portfolio is allocated to the stock. Other professional money managers that hold long positions include Bill Miller’s Miller Value Partners, Renaissance Technologies and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital. In terms of the portfolio weights assigned to each position Trigran Investments allocated the biggest weight to Quotient Technology Inc (NYSE:QUOT), around 11.38% of its 13F portfolio. Lynrock Lake is also relatively very bullish on the stock, earmarking 11.3 percent of its 13F equity portfolio to QUOT.
Consequently, key hedge funds have jumped into Quotient Technology Inc (NYSE:QUOT) headfirst. Millennium Management, managed by Israel Englander, initiated the most valuable position in Quotient Technology Inc (NYSE:QUOT). Millennium Management had $3.5 million invested in the company at the end of the quarter. Minhua Zhang’s Weld Capital Management also made a $0.2 million investment in the stock during the quarter. The other funds with brand new QUOT positions are Donald Sussman’s Paloma Partners and Matthew Hulsizer’s PEAK6 Capital Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Quotient Technology Inc (NYSE:QUOT) but similarly valued. We will take a look at Eastman Kodak Co. (NYSE:KODK), Immatics N.V. (NASDAQ:IMTX), Himax Technologies, Inc. (NASDAQ:HIMX), Meta Financial Group Inc. (NASDAQ:CASH), Conduent Incorporated (NYSE:CNDT), National Western Life Group Inc. (NASDAQ:NWLI), and GameStop Corp. (NYSE:GME). All of these stocks’ market caps match QUOT’s market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position KODK,15,53830,12 IMTX,22,161638,22 HIMX,6,42466,-3 CASH,6,41879,-10 CNDT,16,185777,-5 NWLI,7,10294,0 GME,28,164392,9 Average,14.3,94325,3.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.3 hedge funds with bullish positions and the average amount invested in these stocks was $94 million. That figure was $304 million in QUOT’s case. GameStop Corp. (NYSE:GME) is the most popular stock in this table. On the other hand Himax Technologies, Inc. (NASDAQ:HIMX) is the least popular one with only 6 bullish hedge fund positions. Quotient Technology Inc (NYSE:QUOT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for QUOT is 48.9. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. Hedge funds were also right about betting on QUOT as the stock returned 19% since the end of Q3 (through 12/14) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.