The financial regulations require hedge funds and wealthy investors that exceeded the $100 million holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st. We at Insider Monkey have made an extensive database of more than 866 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded SiTime Corporation (NASDAQ:SITM) based on those filings.
SiTime Corporation (NASDAQ:SITM) was in 20 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic was previously 12. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. SITM investors should be aware of an increase in support from the world’s most elite money managers in recent months. There were 11 hedge funds in our database with SITM positions at the end of the fourth quarter. Our calculations also showed that SITM isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Richard Driehaus of Driehaus Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Chuck Schumer recently stated that marijuana legalization will be a Senate priority. So, we are checking out this under the radar stock that will benefit from this. We go through lists like the 10 best battery stocks 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. Keeping this in mind we’re going to analyze the recent hedge fund action surrounding SiTime Corporation (NASDAQ:SITM).
Do Hedge Funds Think SITM Is A Good Stock To Buy Now?
At Q1’s end, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of 82% from the previous quarter. The graph below displays the number of hedge funds with bullish position in SITM over the last 23 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, Richard Driehaus’s Driehaus Capital has the biggest position in SiTime Corporation (NASDAQ:SITM), worth close to $56 million, amounting to 0.8% of its total 13F portfolio. On Driehaus Capital’s heels is Trigran Investments, managed by Douglas T. Granat, which holds a $41.8 million position; the fund has 5.2% of its 13F portfolio invested in the stock. Some other peers that are bullish encompass Ken Griffin’s Citadel Investment Group, Andrew Dalrymple and Barry McCorkell’s Aubrey Capital Management and Daryl Smith’s Kayak Investment Partners. In terms of the portfolio weights assigned to each position Trigran Investments allocated the biggest weight to SiTime Corporation (NASDAQ:SITM), around 5.17% of its 13F portfolio. Aubrey Capital Management is also relatively very bullish on the stock, earmarking 2.81 percent of its 13F equity portfolio to SITM.
Consequently, key money managers have jumped into SiTime Corporation (NASDAQ:SITM) headfirst. Kayak Investment Partners, managed by Daryl Smith, established the biggest position in SiTime Corporation (NASDAQ:SITM). Kayak Investment Partners had $7.8 million invested in the company at the end of the quarter. Matthew L Pinz’s Pinz Capital also initiated a $3.5 million position during the quarter. The other funds with new positions in the stock are Paul Tudor Jones’s Tudor Investment Corp, Matthew Halbower’s Pentwater Capital Management, and Christopher Hillary’s Roubaix Capital.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as SiTime Corporation (NASDAQ:SITM) but similarly valued. We will take a look at Granite Construction Incorporated (NYSE:GVA), Newmark Group, Inc. (NASDAQ:NMRK), Northwest Bancshares, Inc. (NASDAQ:NWBI), CorVel Corporation (NASDAQ:CRVL), Covanta Holding Corporation (NYSE:CVA), Cognyte Software Ltd. (NASDAQ:CGNT), and Plains GP Holdings LP (NASDAQ:PAGP). This group of stocks’ market valuations are similar to SITM’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GVA | 13 | 29407 | 2 |
| NMRK | 21 | 193761 | -1 |
| NWBI | 14 | 32740 | 5 |
| CRVL | 10 | 115115 | -3 |
| CVA | 21 | 180517 | 0 |
| CGNT | 12 | 233892 | 12 |
| PAGP | 15 | 72231 | -3 |
| Average | 15.1 | 122523 | 1.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 15.1 hedge funds with bullish positions and the average amount invested in these stocks was $123 million. That figure was $157 million in SITM’s case. Newmark Group, Inc. (NASDAQ:NMRK) is the most popular stock in this table. On the other hand CorVel Corporation (NASDAQ:CRVL) is the least popular one with only 10 bullish hedge fund positions. SiTime Corporation (NASDAQ:SITM) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SITM is 85.5. 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 gained 23.8% in 2021 through July 16th and still beat the market by 7.7 percentage points. Hedge funds were also right about betting on SITM as the stock returned 19% since the end of Q1 (through 7/16) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Sitime Corp (NASDAQ:SITM)
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Disclosure: None. This article was originally published at Insider Monkey.
