Is Angie’s List Inc (ANGI) A Good Stock To Buy?

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on Angie’s List Inc (NASDAQ:ANGI).

Angie’s List Inc (NASDAQ:ANGI) shares didn’t see a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 11 hedge funds’ portfolios at the end of the third quarter of 2016, same as at the end of the second quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as M/I Homes Inc (NYSE:MHO), Bojangles Inc (NASDAQ:BOJA), and Regis Corporation (NYSE:RGS) to gather more data points.

We care about hedge fund sentiment because historically hedge funds’ stock picks delivered strong risk adjusted returns. There are certain segments of the market where hedge funds’ stock picks performed much better than its benchmarks. For instance, the 30 most popular mid-cap stocks among the best performing hedge funds returned 18% over the last 12 months outpacing S&P 500 Index by more than 10 percentage points. We developed this strategy 2.5 years ago and started sharing its picks in our quarterly newsletter. It bested the S&P 500 Index ETFs by delivering a solid 39% vs. 22% gain for its benchmarks.

What does the smart money think about Angie’s List Inc (NASDAQ:ANGI)?

Heading into the fourth quarter of 2016, a total of 11 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards ANGI over the last 5 quarters, which has remained fairly steady. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

When looking at the institutional investors followed by Insider Monkey, TCS Capital Management, led by Eric Semler, holds the number one position in Angie’s List Inc (NASDAQ:ANGI). TCS Capital Management has a $58.6 million position in the stock, comprising 32% of its 13F portfolio. The second most bullish fund manager is Renaissance Technologies, one of the largest hedge funds in the world, which holds a $6.8 million position. Some other professional money managers with similar optimism contain David E. Shaw’s D E Shaw, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Joseph Mathias’ Concourse Capital Management. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that dumped their entire stakes in the stock during the third quarter. Interestingly, Spencer M. Waxman’s Shannon River Fund Management dumped the biggest position of all the investors watched by Insider Monkey, comprising close to $1.8 million in stock. Peter Muller’s fund, PDT Partners, also sold off its stock, about $0.1 million worth.

Let’s go over hedge fund activity in other stocks similar to Angie’s List Inc (NASDAQ:ANGI). We will take a look at M/I Homes Inc (NYSE:MHO), Bojangles Inc (NASDAQ:BOJA), Regis Corporation (NYSE:RGS), and Rayonier Advanced Materials Inc (NYSE:RYAM). This group of stocks’ market values are similar to ANGI’s market value.

As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $91 million. That figure was $77 million in ANGI’s case. Rayonier Advanced Materials Inc (NYSE:RYAM) is the most popular stock in this table. On the other hand M/I Homes Inc (NYSE:MHO) is the least popular one with only 9 bullish hedge fund positions. Angie’s List Inc (NASDAQ:ANGI) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard RYAM might be a better candidate to consider taking a long position in.

Disclosure: None