Hedge Funds Have Never Been This Bullish On Limelight Networks, Inc. (LLNW)

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 Limelight Networks, Inc. (NASDAQ:LLNW).

Limelight Networks, Inc. (NASDAQ:LLNW) was in 19 hedge funds’ portfolios at the end of March. LLNW shareholders have witnessed an increase in activity from the world’s largest hedge funds in recent months. There were 16 hedge funds in our database with LLNW holdings at the end of the previous quarter. Our calculations also showed that LLNW 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).

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

In the 21st century investor’s toolkit there are dozens of methods investors use to analyze their holdings. Some of the less known methods are hedge fund and insider trading indicators. Our experts have shown that, historically, those who follow the best picks of the top money managers can outpace their index-focused peers by a superb margin (see the details here).

Carlo Cannell

J. Carlo Cannell of Cannell Capital

We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s take a look at the key hedge fund action surrounding Limelight Networks, Inc. (NASDAQ:LLNW).

What have hedge funds been doing with Limelight Networks, Inc. (NASDAQ:LLNW)?

At Q1’s end, a total of 19 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 19% from one quarter earlier. On the other hand, there were a total of 12 hedge funds with a bullish position in LLNW a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

More specifically, Driehaus Capital was the largest shareholder of Limelight Networks, Inc. (NASDAQ:LLNW), with a stake worth $20.9 million reported as of the end of September. Trailing Driehaus Capital was Cannell Capital, which amassed a stake valued at $16.1 million. Royce & Associates, Harvey Partners, and Intrinsic Edge Capital 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 Harvey Partners allocated the biggest weight to Limelight Networks, Inc. (NASDAQ:LLNW), around 10.02% of its 13F portfolio. Cannell Capital is also relatively very bullish on the stock, setting aside 6.7 percent of its 13F equity portfolio to LLNW.

As industrywide interest jumped, key money managers were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, created the largest position in Limelight Networks, Inc. (NASDAQ:LLNW). Marshall Wace LLP had $2 million invested in the company at the end of the quarter. Ken Grossman and Glen Schneider’s SG Capital Management also made a $0.6 million investment in the stock during the quarter. The following funds were also among the new LLNW investors: Peter Algert and Kevin Coldiron’s Algert Coldiron Investors, Donald Sussman’s Paloma Partners, and Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors.

Let’s now review hedge fund activity in other stocks similar to Limelight Networks, Inc. (NASDAQ:LLNW). We will take a look at The Buckle, Inc. (NYSE:BKE), Vocera Communications Inc (NYSE:VCRA), American Finance Trust, Inc. (NASDAQ:AFIN), and First Bancorp (NASDAQ:FBNC). All of these stocks’ market caps are similar to LLNW’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
BKE 15 46702 -6
VCRA 15 99255 2
AFIN 10 13470 2
FBNC 13 42593 -1
Average 13.25 50505 -0.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 13.25 hedge funds with bullish positions and the average amount invested in these stocks was $51 million. That figure was $87 million in LLNW’s case. The Buckle, Inc. (NYSE:BKE) is the most popular stock in this table. On the other hand American Finance Trust, Inc. (NASDAQ:AFIN) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Limelight Networks, Inc. (NASDAQ:LLNW) is more popular among hedge funds. 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 13.4% in 2020 through June 22nd and still beat the market by 15.9 percentage points. Unfortunately LLNW wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on LLNW were disappointed as the stock returned -2.2% during the second quarter (through June 22nd) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

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