Hedge Funds Are Crazy About Impinj, Inc. (PI)

In this article you are going to find out whether hedge funds think Impinj, Inc. (NASDAQ:PI) is a good investment right now. We like to check what the smart money thinks first before doing extensive research on a given stock. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to predict the winners in the stock market.

Is Impinj, Inc. (NASDAQ:PI) the right pick for your portfolio? Money managers were taking an optimistic view. The number of long hedge fund positions moved up by 2 lately. Impinj, Inc. (NASDAQ:PI) was in 20 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 22. Our calculations also showed that PI isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

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 185.4% since March 2017 and outperformed the S&P 500 ETFs by more than 79 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, plant based food market is expected to explode 100-fold by 2050, so we are checking out this under-the-radar stock. We go through lists like the 10 best growth stocks to buy 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 let’s take a glance at the key hedge fund action encompassing Impinj, Inc. (NASDAQ:PI).

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

At the end of June, a total of 20 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 11% from the first quarter of 2020. The graph below displays the number of hedge funds with bullish position in PI over the last 24 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).

Among these funds, Sylebra Capital Management held the most valuable stake in Impinj, Inc. (NASDAQ:PI), which was worth $226.9 million at the end of the second quarter. On the second spot was Toronado Partners which amassed $35.3 million worth of shares. Driehaus Capital, D E Shaw, and Millennium Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Toronado Partners allocated the biggest weight to Impinj, Inc. (NASDAQ:PI), around 10.3% of its 13F portfolio. Sylebra Capital Management is also relatively very bullish on the stock, dishing out 5.63 percent of its 13F equity portfolio to PI.

As one would reasonably expect, key hedge funds were breaking ground themselves. Intrinsic Edge Capital, managed by Mark Coe, assembled the most valuable position in Impinj, Inc. (NASDAQ:PI). Intrinsic Edge Capital had $7.6 million invested in the company at the end of the quarter. Ken Fisher’s Fisher Asset Management also made a $3.1 million investment in the stock during the quarter. The only other fund with a new position in the stock is Matthew Hulsizer’s PEAK6 Capital Management.

Let’s check out hedge fund activity in other stocks similar to Impinj, Inc. (NASDAQ:PI). These stocks are Forma Therapeutics Holdings, Inc. (NASDAQ:FMTX), Upland Software Inc (NASDAQ:UPLD), BellRing Brands, Inc. (NYSE:BRBR), Arcos Dorados Holding Inc (NYSE:ARCO), AlloVir, Inc. (NASDAQ:ALVR), ChipMOS Technologies Inc (NASDAQ:IMOS), and Stoke Therapeutics, Inc. (NASDAQ:STOK). All of these stocks’ market caps match PI’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $194 million. That figure was $379 million in PI’s case. Upland Software Inc (NASDAQ:UPLD) is the most popular stock in this table. On the other hand ChipMOS Technologies Inc (NASDAQ:IMOS) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Impinj, Inc. (NASDAQ:PI) is more popular among hedge funds. Our overall hedge fund sentiment score for PI is 84.3. 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 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 returned 24% in 2021 through October 22nd but still managed to beat the market by 1.6 percentage points. Hedge funds were also right about betting on PI as the stock returned 6.6% since the end of June (through 10/22) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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

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