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Hedge Funds Have Never Been This Bullish On Lindblad Expeditions Holdings Inc (LIND)

Lindblad Expeditions Holdings Inc (NASDAQ:LIND) investors should be aware of an increase in activity from the world’s largest hedge funds lately. LIND was in 20 hedge funds’ portfolios at the end of the first quarter of 2019. There were 14 hedge funds in our database with LIND holdings at the end of the previous quarter. This is usually a bullish indicator. We observed this in other stocks like Roku, Uniqure, Avalara, and DisneyRoku returned returned 45%, Uniqure and Avalara delivered a 30% gain each, and Disney outperformed the market by 23 percentage points in Q2.

So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren’t comfortable with shorting stocks, you should at least avoid initiating long positions in our short portfolio.

Jeff Ubben VALUEACT CAPITAL

Let’s view the fresh hedge fund action encompassing Lindblad Expeditions Holdings Inc (NASDAQ:LIND).

How have hedgies been trading Lindblad Expeditions Holdings Inc (NASDAQ:LIND)?

At the end of the first quarter, a total of 20 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 43% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards LIND over the last 15 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

LIND_jun2019

Among these funds, ValueAct Capital held the most valuable stake in Lindblad Expeditions Holdings Inc (NASDAQ:LIND), which was worth $44.1 million at the end of the first quarter. On the second spot was Royce & Associates which amassed $16.4 million worth of shares. Moreover, Deep Field Asset Management, Renaissance Technologies, and Rutabaga Capital Management were also bullish on Lindblad Expeditions Holdings Inc (NASDAQ:LIND), allocating a large percentage of their portfolios to this stock.

As one would reasonably expect, specific money managers were breaking ground themselves. Millennium Management, managed by Israel Englander, initiated the biggest position in Lindblad Expeditions Holdings Inc (NASDAQ:LIND). Millennium Management had $5.6 million invested in the company at the end of the quarter. Richard Driehaus’s Driehaus Capital also initiated a $5.2 million position during the quarter. The other funds with new positions in the stock are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Bruce Kovner’s Caxton Associates LP, and David Harding’s Winton Capital Management.

Let’s check out hedge fund activity in other stocks similar to Lindblad Expeditions Holdings Inc (NASDAQ:LIND). These stocks are TrueCar Inc (NASDAQ:TRUE), Revance Therapeutics Inc (NASDAQ:RVNC), Northfield Bancorp Inc (NASDAQ:NFBK), and US Concrete Inc (NASDAQ:USCR). All of these stocks’ market caps are similar to LIND’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TRUE 17 166148 2
RVNC 12 24975 3
NFBK 5 32141 1
USCR 17 76849 -1
Average 12.75 75028 1.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 12.75 hedge funds with bullish positions and the average amount invested in these stocks was $75 million. That figure was $157 million in LIND’s case. TrueCar Inc (NASDAQ:TRUE) is the most popular stock in this table. On the other hand Northfield Bancorp Inc (NASDAQ:NFBK) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Lindblad Expeditions Holdings Inc (NASDAQ:LIND) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Hedge funds were also right about betting on LIND as the stock returned 15.2% during the same period 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.

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

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