After several tireless days we have finished crunching the numbers from nearly 817 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of September 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Akoustis Technologies, Inc. (NASDAQ:AKTS).
Akoustis Technologies, Inc. (NASDAQ:AKTS) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 6 hedge funds’ portfolios at the end of the third quarter of 2020. Our calculations also showed that AKTS isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks). At the end of this article we will also compare AKTS to other stocks including Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), UFP Technologies, Inc. (NASDAQ:UFPT), and Bar Harbor Bankshares (NYSE:BHB) to get a better sense of its popularity.
Video: Watch our video about the top 5 most popular hedge fund stocks.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. 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 S&P 500 ETFs by 66 percentage points since March 2017 (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.
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now let’s take a peek at the fresh hedge fund action surrounding Akoustis Technologies, Inc. (NASDAQ:AKTS).
Hedge fund activity in Akoustis Technologies, Inc. (NASDAQ:AKTS)
At the end of September, a total of 6 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the second quarter of 2020. By comparison, 6 hedge funds held shares or bullish call options in AKTS a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
The largest stake in Akoustis Technologies, Inc. (NASDAQ:AKTS) was held by Rima Senvest Management, which reported holding $5 million worth of stock at the end of September. It was followed by Boardman Bay Capital Management with a $3.2 million position. Other investors bullish on the company included North Run Capital, Millennium Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position North Run Capital allocated the biggest weight to Akoustis Technologies, Inc. (NASDAQ:AKTS), around 3.36% of its 13F portfolio. Boardman Bay Capital Management is also relatively very bullish on the stock, designating 3.25 percent of its 13F equity portfolio to AKTS.
Since Akoustis Technologies, Inc. (NASDAQ:AKTS) has witnessed a decline in interest from the smart money, we can see that there exists a select few hedgies who were dropping their entire stakes last quarter. Intriguingly, Robert Joseph Caruso’s Select Equity Group cut the largest position of the 750 funds tracked by Insider Monkey, totaling about $1.1 million in stock, and Ken Griffin’s Citadel Investment Group was right behind this move, as the fund said goodbye to about $0.1 million worth. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s also examine hedge fund activity in other stocks similar to Akoustis Technologies, Inc. (NASDAQ:AKTS). These stocks are Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), UFP Technologies, Inc. (NASDAQ:UFPT), Bar Harbor Bankshares (NYSE:BHB), Business First Bancshares, Inc. (NASDAQ:BFST), DSP Group, Inc. (NASDAQ:DSPG), OptimizeRx Corporation (NASDAQ:OPRX), and Meten EdtechX Education Group Ltd. (NASDAQ:METX). All of these stocks’ market caps match AKTS’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.7 hedge funds with bullish positions and the average amount invested in these stocks was $26 million. That figure was $13 million in AKTS’s case. DSP Group, Inc. (NASDAQ:DSPG) is the most popular stock in this table. On the other hand Bar Harbor Bankshares (NYSE:BHB) is the least popular one with only 2 bullish hedge fund positions. Akoustis Technologies, Inc. (NASDAQ:AKTS) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for AKTS is 44.2. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through November 27th and surpassed the market again by 16.1 percentage points. Unfortunately AKTS wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); AKTS investors were disappointed as the stock returned -2.2% since the end of September (through 11/27) 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 most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.