Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Should You Follow This Investor Into His Top Small-Cap Picks?

Page 1 of 2

Peter A. Wright started his fund, P.A.W Capital, back in 1990 and in the current round of 13F filings, the fund reported an equity portfolio worth $87.20 million as of the end of September, which was down from $99.15 million a quarter earlier. During the third quarter, the investor initiated five new positions and exited nine former holdings. Wright is still bullish on the tech sector, which amasses around half of P.A.W.’s 13F portfolio. In this article we will talk about P.A.W.’s top five small-cap holdings, which are of particular interest to us at Insider Monkey (more on that below).

everything possible/

everything possible/

P.A.W. Capital is one of the more than 730 funds that we track as part of our small-cap strategy. Through extensive research, we have determined that analyzing their 13F filings can help a retail investor generate market-beating returns by following the small-caps that these funds are collectively bullish on. Our strategy imitates a portfolio of the 15 most popular small-cap picks among the funds that we track and it has returned 102% since August 2012, beating the S&P 500 ETF (SPY) by around 53 percentage points (see more details here).

Peter A. Wright
Peter A. Wright

In Group Inc (NASDAQ:WWWW), P.A.W. reported a stake containing 340,000 shares worth $7.17 million and even though the investor trimmed the position by 10% during the third quarter it still remained at the top of its portfolio. The stock of the provider of Internet services for small businesses lost around 13% in the third quarter, but is still 27% in the green in year-to-date terms. Group Inc (NASDAQ:WWWW)’s stock may gain even more ground, taking into account that it currently trades at around 9.5-times forward earnings and sports a PEG ratio of 0.71. At the end of June, 21 funds from our database held stakes that collectively amassed over 25% of Group Inc (NASDAQ:WWWW)’s outstanding stock.

Follow Group Inc. (NASDAQ:WEB)
Trade (NASDAQ:WEB) Now!

On the other hand, in Allot Communications Ltd (NASDAQ:ALLT), P.A.W boosted its position by 45% between July and September and disclosed holding 960,000 shares valued at $4.71 million as of September 30. Allot Communications Ltd (NASDAQ:ALLT) is engaged in broadband solutions and is another favorite tech pick of Peter Wright. The stock lost 31% in the third quarter and the fact that P.A.W. acquired more shares seems to suggest that Wright believes in the future potential of the company. The stock plunged in May after Barclays downgraded the company, expressing concern with its guidance and transparency. In July, a corporate litigation boutique announced that it would investigate Barclays’ claims on behalf of certain investors. During the second quarter, the number of funds bullish on Allot Communications Ltd (NASDAQ:ALLT) declined to nine from 12, while the aggregate value of their stakes was equal to 16.80% of the company’s outstanding stock.

Follow Allot Communications Ltd (NASDAQ:ALLT)
Trade (NASDAQ:ALLT) Now!

P.A.W.’s other top three picks are Lifelock Inc (NYSE:LOCK), Lendingtree Inc (NASDAQ:TREE), and Virtusa Corporation (NASDAQ:VRTU), and we will discuss them in more detail on the following page.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!