Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Is EZCORP Inc (EZPW) A Good Stock To Buy According To Hedge Funds?

Is EZCORP Inc (NASDAQ:EZPW) a good stock to buy according to hedge funds? Hedge fund interest in EZPW shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare EZPW to other stocks including Transenterix Inc (NYSEMKT:TRXC), pdvWireless Inc (NASDAQ:PDVW), and McEwen Mining Inc (NYSE:MUX) to get a better sense of its popularity.

In the 21st century investor’s toolkit there are a large number of methods stock market investors employ to evaluate stocks. A pair of the most underrated methods are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the best picks of the best money managers can trounce the S&P 500 by a significant amount (see the details here).

David Harding

Let’s take a look at the new hedge fund action encompassing EZCORP Inc (NASDAQ:EZPW).

Hedge fund activity in EZCORP Inc (NASDAQ:EZPW)

At Q1’s end, a total of 20 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the fourth quarter of 2018. By comparison, 14 hedge funds held shares or bullish call options in EZPW a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

EZPW_jun2019

More specifically, Lafitte Capital Management was the largest shareholder of EZCORP Inc (NASDAQ:EZPW), with a stake worth $50.3 million reported as of the end of March. Trailing Lafitte Capital Management was Archon Capital Management, which amassed a stake valued at $11.6 million. Renaissance Technologies, Sabrepoint Capital, and Azora Capital were also very fond of the stock, giving the stock large weights in their portfolios.

Due to the fact that EZCORP Inc (NASDAQ:EZPW) has faced falling interest from hedge fund managers, logic holds that there is a sect of money managers that decided to sell off their full holdings last quarter. At the top of the heap, Amy Minella’s Cardinal Capital sold off the biggest investment of all the hedgies monitored by Insider Monkey, totaling about $7.5 million in stock, and Noam Gottesman’s GLG Partners was right behind this move, as the fund dropped about $2.9 million worth. These moves are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now take a look at hedge fund activity in other stocks similar to EZCORP Inc (NASDAQ:EZPW). We will take a look at Transenterix Inc (NYSEMKT:TRXC), pdvWireless Inc (NASDAQ:PDVW), McEwen Mining Inc (NYSE:MUX), and U.S. Well Services, Inc. (NASDAQ:USWS). This group of stocks’ market valuations resemble EZPW’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TRXC 13 10958 5
PDVW 13 252859 1
MUX 5 4852 0
USWS 13 42384 -1
Average 11 77763 1.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $78 million. That figure was $117 million in EZPW’s case. Transenterix Inc (NYSEMKT:TRXC) is the most popular stock in this table. On the other hand McEwen Mining Inc (NYSE:MUX) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks EZCORP Inc (NASDAQ:EZPW) 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. Unfortunately EZPW wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on EZPW were disappointed as the stock returned -2.6% during the same 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 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market in Q2.

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

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading...