How Hedge Fund Traded Quintana Energy Services Inc. (QES) During The Crash

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 Quintana Energy Services Inc. (NYSE:QES).

Hedge fund interest in Quintana Energy Services Inc. (NYSE:QES) 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 QES to other stocks including Celldex Therapeutics, Inc. (NASDAQ:CLDX), OncoSec Medical Incorporated (NASDAQ:ONCS), and Rocky Mountain Chocolate Factory, Inc. (NASDAQ:RMCF) to get a better sense of its popularity.

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

To most traders, hedge funds are perceived as slow, old financial tools of years past. While there are over 8000 funds trading today, Our researchers choose to focus on the upper echelon of this group, about 850 funds. These hedge fund managers shepherd the majority of all hedge funds’ total asset base, and by following their top picks, Insider Monkey has found several investment strategies that have historically exceeded the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .


Jim Simons of Renaissance Technologies

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. You can watch our latest hedge fund manager interview here and find out the name of the large-cap healthcare stock that Sio Capital’s Michael Castor expects to double. 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 S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to review the fresh hedge fund action surrounding Quintana Energy Services Inc. (NYSE:QES).

Hedge fund activity in Quintana Energy Services Inc. (NYSE:QES)

At Q1’s end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the previous quarter. The graph below displays the number of hedge funds with bullish position in QES over the last 18 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).

Is QES A Good Stock To Buy?

Of the funds tracked by Insider Monkey, Melqart Asset Management, managed by Michel Massoud, holds the biggest position in Quintana Energy Services Inc. (NYSE:QES). Melqart Asset Management has a $2.8 million position in the stock, comprising 0.3% of its 13F portfolio. The second most bullish fund manager is Renaissance Technologies, which holds a $0.1 million position; less than 0.1%% of its 13F portfolio is allocated to the company. In terms of the portfolio weights assigned to each position Melqart Asset Management allocated the biggest weight to Quintana Energy Services Inc. (NYSE:QES), around 0.27% of its 13F portfolio. Millennium Management is also relatively very bullish on the stock, dishing out 0.0001 percent of its 13F equity portfolio to QES.

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Quintana Energy Services Inc. (NYSE:QES) but similarly valued. We will take a look at Celldex Therapeutics, Inc. (NASDAQ:CLDX), OncoSec Medical Incorporated (NASDAQ:ONCS), Rocky Mountain Chocolate Factory, Inc. (NASDAQ:RMCF), and SilverBow Resorces, Inc. (NYSE:SBOW). This group of stocks’ market values resemble QES’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CLDX 3 2004 -1
ONCS 2 404 0
RMCF 2 3264 0
SBOW 3 12402 -1
Average 2.5 4519 -0.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 2.5 hedge funds with bullish positions and the average amount invested in these stocks was $5 million. That figure was $3 million in QES’s case. Celldex Therapeutics, Inc. (NASDAQ:CLDX) is the most popular stock in this table. On the other hand OncoSec Medical Incorporated (NASDAQ:ONCS) is the least popular one with only 2 bullish hedge fund positions. Quintana Energy Services Inc. (NYSE:QES) 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 7.9% in 2020 through May 22nd but beat the market by 15.6 percentage points. Unfortunately QES wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on QES were disappointed as the stock returned -6.3% 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.

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