How Hedge Funds Traded Qumu Corp (QUMU) During The Crash

We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Qumu Corp (NASDAQ:QUMU) based on that data.

Hedge fund interest in Qumu Corp (NASDAQ:QUMU) 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 QUMU to other stocks including Trinity Biotech plc (NASDAQ:TRIB), Limbach Holdings, Inc. (NASDAQ:LMB), and Seelos Therapeutics, Inc. (NASDAQ:SEEL) to get a better sense of its popularity.

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

To most investors, hedge funds are seen as unimportant, outdated financial vehicles of the past. While there are greater than 8000 funds trading today, Our researchers look at the bigwigs of this club, about 850 funds. It is estimated that this group of investors preside over the lion’s share of all hedge funds’ total capital, and by monitoring their finest stock picks, Insider Monkey has spotted various investment strategies that have historically outpaced the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per annum 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. Keeping this in mind we’re going to take a look at the key hedge fund action surrounding Qumu Corp (NASDAQ:QUMU).

Hedge fund activity in Qumu Corp (NASDAQ:QUMU)

At the end of the first quarter, a total of 3 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the fourth quarter of 2019. Below, you can check out the change in hedge fund sentiment towards QUMU over the last 18 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is QUMU A Good Stock To Buy?

Among these funds, Harbert Management held the most valuable stake in Qumu Corp (NASDAQ:QUMU), which was worth $2.3 million at the end of the third quarter. On the second spot was Fondren Management which amassed $1.4 million worth of shares. Renaissance Technologies was 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 Harbert Management allocated the biggest weight to Qumu Corp (NASDAQ:QUMU), around 3.8% of its 13F portfolio. Fondren Management is also relatively very bullish on the stock, designating 3.56 percent of its 13F equity portfolio to QUMU.

We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Manatuck Hill Partners. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Fondren Management).

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Qumu Corp (NASDAQ:QUMU) but similarly valued. These stocks are Trinity Biotech plc (NASDAQ:TRIB), Limbach Holdings, Inc. (NASDAQ:LMB), Seelos Therapeutics, Inc. (NASDAQ:SEEL), and Dawson Geophysical Company (NASDAQ:DWSN). This group of stocks’ market values resemble QUMU’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TRIB 6 3507 0
LMB 2 361 0
SEEL 4 829 2
DWSN 6 2479 -1
Average 4.5 1794 0.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 4.5 hedge funds with bullish positions and the average amount invested in these stocks was $2 million. That figure was $5 million in QUMU’s case. Trinity Biotech plc (NASDAQ:TRIB) is the most popular stock in this table. On the other hand Limbach Holdings, Inc. (NASDAQ:LMB) is the least popular one with only 2 bullish hedge fund positions. Qumu Corp (NASDAQ:QUMU) is not the least popular stock in this group but hedge fund interest is still below average. 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 and still beat the market by 15.6 percentage points. A small number of hedge funds were also right about betting on QUMU as the stock returned 54.2% during the second quarter and outperformed the market by an even larger margin.

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