Hedge Funds Keep Buying Repro Med Systems, Inc. (KRMD)

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. We are almost done with the second quarter. Investors decided to bet on the economic recovery and a stock market rebound. S&P 500 Index returned almost 20% this quarter. In this article we look at how hedge funds traded Repro Med Systems, Inc. (NASDAQ:KRMD) and determine whether the smart money was really smart about this stock.

Repro Med Systems, Inc. (NASDAQ:KRMD) investors should pay attention to an increase in support from the world’s most elite money managers in recent months. Our calculations also showed that KRMD 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.

At the moment there are tons of metrics stock market investors have at their disposal to analyze stocks. Two of the most innovative metrics are hedge fund and insider trading signals. We have shown that, historically, those who follow the best picks of the top money managers can outperform their index-focused peers by a superb margin (see the details here).

Bruce Kovner, Caxton Associates LP

Bruce Kovner of Caxton Associates LP

At Insider Monkey we scour multiple sources to uncover the next great investment idea. There is a lot of volatility in the markets and this presents amazing investment opportunities from time to time. For example, this trader claims to deliver juiced up returns with one trade a week, so we are checking out his highest conviction idea. A second trader claims to score lucrative profits by utilizing a “weekend trading strategy”, so we look into his strategy’s picks. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We recently recommended several stocks partly inspired by legendary Bill Miller’s investor letter. 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 analyze the recent hedge fund action encompassing Repro Med Systems, Inc. (NASDAQ:KRMD).

How have hedgies been trading Repro Med Systems, Inc. (NASDAQ:KRMD)?

Heading into the second quarter of 2020, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 25% from the fourth quarter of 2019. The graph below displays the number of hedge funds with bullish position in KRMD over the last 18 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is KRMD A Good Stock To Buy?

Of the funds tracked by Insider Monkey, Parkman Healthcare Partners, managed by Greg Martinez, holds the number one position in Repro Med Systems, Inc. (NASDAQ:KRMD). Parkman Healthcare Partners has a $4.3 million position in the stock, comprising 2% of its 13F portfolio. On Parkman Healthcare Partners’s heels is Millennium Management, led by Israel Englander, holding a $2 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other professional money managers with similar optimism consist of Renaissance Technologies, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Joseph Edelman’s Perceptive Advisors. In terms of the portfolio weights assigned to each position Parkman Healthcare Partners allocated the biggest weight to Repro Med Systems, Inc. (NASDAQ:KRMD), around 1.99% of its 13F portfolio. Navellier & Associates is also relatively very bullish on the stock, designating 0.09 percent of its 13F equity portfolio to KRMD.

As industrywide interest jumped, key money managers have jumped into Repro Med Systems, Inc. (NASDAQ:KRMD) headfirst. Renaissance Technologies, assembled the biggest position in Repro Med Systems, Inc. (NASDAQ:KRMD). Renaissance Technologies had $0.8 million invested in the company at the end of the quarter. Bruce Kovner’s Caxton Associates LP also made a $0.3 million investment in the stock during the quarter. The other funds with new positions in the stock are Greg Eisner’s Engineers Gate Manager and John Overdeck and David Siegel’s Two Sigma Advisors.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Repro Med Systems, Inc. (NASDAQ:KRMD) but similarly valued. We will take a look at Shoe Carnival, Inc. (NASDAQ:SCVL), Tribune Publishing Company (NASDAQ:TPCO), Blue Bird Corporation (NASDAQ:BLBD), and Casa Systems, Inc. (NASDAQ:CASA). All of these stocks’ market caps resemble KRMD’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
SCVL 11 31637 -5
TPCO 13 102133 0
BLBD 9 21205 -3
CASA 6 3172 -4
Average 9.75 39537 -3

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.75 hedge funds with bullish positions and the average amount invested in these stocks was $40 million. That figure was $9 million in KRMD’s case. Tribune Publishing Company (NASDAQ:TPCO) is the most popular stock in this table. On the other hand Casa Systems, Inc. (NASDAQ:CASA) is the least popular one with only 6 bullish hedge fund positions. Repro Med Systems, Inc. (NASDAQ:KRMD) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 12.3% in 2020 through June 30th but beat the market by 15.5 percentage points. Unfortunately KRMD wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on KRMD were disappointed as the stock returned 19.7% during the same time period 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 many of these stocks already outperformed the market so far this year.

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