We have been waiting for this for a year and finally the third quarter ended up showing a nice bump in the performance of small-cap stocks. Both the S&P 500 and Russell 2000 were up since the end of the second quarter, but small-cap stocks outperformed the large-cap stocks by double digits. This is important for hedge funds, which are big supporters of small-cap stocks, because their investors started pulling some of their capital out due to poor recent performance. It is very likely that equity hedge funds will deliver better risk adjusted returns in the second half of this year. In this article we are going to look at how this recent market trend affected the sentiment of hedge funds towards Orthofix International NV (NASDAQ:OFIX), and what that likely means for the prospects of the company and its stock.
Is Orthofix International NV (NASDAQ:OFIX) a buy right now? Money managers are becoming hopeful. The number of bullish hedge fund positions inched up by 3 recently. OFIX was in 23 hedge funds’ portfolios at the end of the third quarter of 2016. There were 20 hedge funds in our database with OFIX positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as American Railcar Industries, Inc. (NASDAQ:ARII), Encore Wire Corporation (NASDAQ:WIRE), and Brooks Automation, Inc. (USA) (NASDAQ:BRKS) to gather more data points.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
With all of this in mind, we’re going to go over the latest action regarding Orthofix International NV (NASDAQ:OFIX).
What does the smart money think about Orthofix International NV (NASDAQ:OFIX)?
At Q3’s end, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, 15% up from the second quarter of 2016. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Camber Capital Management, managed by Stephen DuBois, holds the biggest position in Orthofix International NV (NASDAQ:OFIX). According to regulatory filings, the fund has a $64.2 million position in the stock, comprising 2.8% of its 13F portfolio. Coming in second is Ric Dillon of Diamond Hill Capital, with a $50.3 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other members of the smart money that are bullish include Mitchell Blutt’s Consonance Capital Management, Jim Simons’s Renaissance Technologies and Israel Englander’s Millennium Management.