Is Autobytel Inc. (NASDAQ:ABTL) a buy right now? Money managers are becoming less confident. The number of bullish hedge fund positions dropped by 1 in recent months.
According to most investors, hedge funds are seen as slow, old investment vehicles of yesteryear. While there are over 8000 funds with their doors open today, we choose to focus on the masters of this club, around 450 funds. It is estimated that this group controls the majority of all hedge funds’ total capital, and by monitoring their best stock picks, we have found a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Equally as beneficial, bullish insider trading sentiment is another way to break down the marketplace. As the old adage goes: there are lots of stimuli for an upper level exec to get rid of shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many academic studies have demonstrated the market-beating potential of this method if “monkeys” know where to look (learn more here).
With all of this in mind, let’s take a glance at the recent action regarding Autobytel Inc. (NASDAQ:ABTL).
What does the smart money think about Autobytel Inc. (NASDAQ:ABTL)?
In preparation for this quarter, a total of 5 of the hedge funds we track were long in this stock, a change of -17% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their stakes significantly.
When looking at the hedgies we track, Clint Coghill’s Coghill Capital Management had the most valuable position in Autobytel Inc. (NASDAQ:ABTL), worth close to $6.4 million, comprising 4.4% of its total 13F portfolio. The second largest stake is held by Chuck Royce of Royce & Associates, with a $1.5 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedgies with similar optimism include Jim Simons’s Renaissance Technologies, Mark A. Nordlicht’s Platinum Management and Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners.
Because Autobytel Inc. (NASDAQ:ABTL) has witnessed bearish sentiment from hedge fund managers, logic holds that there were a few hedgies who were dropping their entire stakes last quarter. It’s worth mentioning that Stuart Peterson’s Artis Capital Management sold off the biggest stake of the 450+ funds we track, comprising about $0.2 million in stock. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 1 funds last quarter.
What have insiders been doing with Autobytel Inc. (NASDAQ:ABTL)?
Insider purchases made by high-level executives is best served when the company we’re looking at has experienced transactions within the past six months. Over the latest half-year time period, Autobytel Inc. (NASDAQ:ABTL) has experienced 3 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Autobytel Inc. (NASDAQ:ABTL). These stocks are Tucows Inc. (USA) (NYSEAMEX:TCX), TheStreet, Inc. (NASDAQ:TST), China Finance Online Co. (ADR) (NASDAQ:JRJC), Phoenix New Media Ltd ADR (NYSE:FENG), and Local Corporation (NASDAQ:LOCM). This group of stocks are in the internet information providers industry and their market caps resemble ABTL’s market cap.