Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small cap stocks -especially when they are screened well- can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those elite funds in these small-cap stocks. In the following paragraphs, we analyze Premier Inc (NASDAQ:PINC) from the perspective of those elite funds.
Premier Inc (NASDAQ:PINC) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 17 hedge funds’ portfolios at the end of the third quarter of 2015. At the end of this article we will also compare PINC to other stocks including Apollo Investment Corp. (NASDAQ:AINV), Axovant Sciences Ltd (NYSE:AXON), and Plexus Corp. (NASDAQ:PLXS) to get a better sense of its popularity.
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Keeping this in mind, let’s take a look at the fresh action encompassing Premier Inc (NASDAQ:PINC).
How are hedge funds trading Premier Inc (NASDAQ:PINC)?
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Panayotis Takis Sparaggis’ Alkeon Capital Management has the number one position in Premier Inc (NASDAQ:PINC), worth close to $115.9 million, amounting to 2.4% of its total 13F portfolio. The second most bullish fund manager is Lee Munder Capital Group, led by Lee Munder, holding a $20.9 million position; 0.4% of its 13F portfolio is allocated to the stock. Some other professional money managers that are bullish comprise Greg Poole’s Echo Street Capital Management, Leighton Welch’s Welch Capital Partners and Jim Simons’ Renaissance Technologies.
Intriguingly, Chuck Royce’s Royce & Associates said goodbye to the largest position of the “upper crust” of funds watched by Insider Monkey, valued at close to $9.2 million in stock, and Cliff Asness’ AQR Capital Management was right behind this move, as the fund dropped about $0.7 million worth. These moves are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Premier Inc (NASDAQ:PINC) but similarly valued. We will take a look at Apollo Investment Corp. (NASDAQ:AINV), Axovant Sciences Ltd (NYSE:AXON), Plexus Corp. (NASDAQ:PLXS), and Super Micro Computer, Inc. (NASDAQ:SMCI). This group of stocks’ market values are closest to PINC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AINV | 17 | 23528 | 1 |
| AXON | 15 | 1148980 | -6 |
| PLXS | 15 | 108007 | 0 |
| SMCI | 14 | 64887 | 0 |
As you can see these stocks had an average of 15.25 hedge funds with bullish positions and the average amount invested in these stocks was $336 million. That figure was $194 million in PINC’s case. Apollo Investment Corp. (NASDAQ:AINV) is the most popular stock in this table. On the other hand Super Micro Computer, Inc. (NASDAQ:SMCI) is the least popular one with only 14 bullish hedge fund positions. Premier Inc (NASDAQ:PINC) is the most popular stock in the group, which makes it worth a closer look.