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Hedge Funds Are Dumping TeleTech Holdings, Inc. (TTEC)

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of TeleTech Holdings, Inc. (NASDAQ:TTEC).

Is TeleTech Holdings, Inc. (NASDAQ:TTEC) a healthy stock for your portfolio? The smart money is getting less bullish. The number of bullish hedge fund bets went down by 11 lately. Our calculations also showed that TTEC isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). TTEC was in 15 hedge funds’ portfolios at the end of the first quarter of 2020. There were 26 hedge funds in our database with TTEC holdings at the end of the previous quarter.

Video: Watch our video about the top 5 most popular hedge fund stocks.

If you’d ask most shareholders, hedge funds are assumed to be underperforming, old investment vehicles of the past. While there are greater than 8000 funds with their doors open at present, We look at the upper echelon of this group, approximately 850 funds. It is estimated that this group of investors oversee most of all hedge funds’ total asset base, and by tailing their finest picks, Insider Monkey has discovered several investment strategies that have historically outstripped Mr. Market. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .

AQR CAPITAL MANAGEMENT

Cliff Asness of AQR Capital Management

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology’s influence will go beyond online payments. So, we are checking out this futurist’s moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we’re going to view the key hedge fund action encompassing TeleTech Holdings, Inc. (NASDAQ:TTEC).

What have hedge funds been doing with TeleTech Holdings, Inc. (NASDAQ:TTEC)?

At Q1’s end, a total of 15 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -42% from the previous quarter. The graph below displays the number of hedge funds with bullish position in TTEC over the last 18 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is TTEC A Good Stock To Buy?

Among these funds, Renaissance Technologies held the most valuable stake in TeleTech Holdings, Inc. (NASDAQ:TTEC), which was worth $16.5 million at the end of the third quarter. On the second spot was Arrowstreet Capital which amassed $5.2 million worth of shares. Citadel Investment Group, AQR Capital Management, and Two Sigma Advisors 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 Zebra Capital Management allocated the biggest weight to TeleTech Holdings, Inc. (NASDAQ:TTEC), around 0.86% of its 13F portfolio. Algert Coldiron Investors is also relatively very bullish on the stock, dishing out 0.4 percent of its 13F equity portfolio to TTEC.

Since TeleTech Holdings, Inc. (NASDAQ:TTEC) has witnessed declining sentiment from hedge fund managers, it’s safe to say that there is a sect of funds that decided to sell off their entire stakes by the end of the first quarter. At the top of the heap, Joseph Samuels’s Islet Management said goodbye to the largest stake of all the hedgies tracked by Insider Monkey, valued at close to $7.9 million in stock. Matthew L Pinz’s fund, Pinz Capital, also sold off its stock, about $2.2 million worth. These transactions are important to note, as total hedge fund interest fell by 11 funds by the end of the first quarter.

Let’s go over hedge fund activity in other stocks similar to TeleTech Holdings, Inc. (NASDAQ:TTEC). These stocks are Chimera Investment Corporation (NYSE:CIM), Summit Materials Inc (NYSE:SUM), Industrias Bachoco, S.A.B. de C.V. (NYSE:IBA), and Tower Semiconductor Ltd. (NASDAQ:TSEM). All of these stocks’ market caps are closest to TTEC’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CIM 17 49036 3
SUM 27 248345 -8
IBA 3 28755 0
TSEM 11 272127 -5
Average 14.5 149566 -2.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $150 million. That figure was $37 million in TTEC’s case. Summit Materials Inc (NYSE:SUM) is the most popular stock in this table. On the other hand Industrias Bachoco, S.A.B. de C.V. (NYSE:IBA) is the least popular one with only 3 bullish hedge fund positions. TeleTech Holdings, Inc. (NASDAQ:TTEC) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but still beat the market by 16.8 percentage points. Hedge funds were also right about betting on TTEC, though not to the same extent, as the stock returned 23.2% during the first two months and twenty five days of the second quarter and outperformed the market as well.

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