Is BCOV A Good Stock To Buy Now?

The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Brightcove Inc (NASDAQ:BCOV).

Is BCOV a good stock to buy now? Brightcove Inc (NASDAQ:BCOV) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 18 hedge funds’ portfolios at the end of the third quarter of 2020. Our calculations also showed that BCOV 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 BCOV to other stocks including The Lovesac Company (NASDAQ:LOVE), AnaptysBio, Inc. (NASDAQ:ANAB), and Allied Motion Technologies, Inc. (NASDAQ:AMOT) to get a better sense of its popularity.

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

In the eyes of most shareholders, hedge funds are seen as slow, old investment tools of years past. While there are over 8000 funds in operation at the moment, We choose to focus on the moguls of this group, around 850 funds. These hedge fund managers control most of all hedge funds’ total asset base, and by observing their inimitable stock picks, Insider Monkey has formulated numerous investment strategies that have historically defeated the broader indices. Insider Monkey’s flagship short hedge fund strategy outperformed 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 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .

David E. Shaw of D.E. Shaw

David E. Shaw of D.E. Shaw

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. With all of this in mind let’s take a gander at the key hedge fund action regarding Brightcove Inc (NASDAQ:BCOV).

Do Hedge Funds Think BCOV Is A Good Stock To Buy Now?

At Q3’s end, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the second quarter of 2020. On the other hand, there were a total of 20 hedge funds with a bullish position in BCOV a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).

Is BCOV A Good Stock To Buy?

More specifically, Trigran Investments was the largest shareholder of Brightcove Inc (NASDAQ:BCOV), with a stake worth $43.8 million reported as of the end of September. Trailing Trigran Investments was Tenzing Global Investors, which amassed a stake valued at $39.8 million. Archon Capital Management, Renaissance Technologies, and D E Shaw were 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 Tenzing Global Investors allocated the biggest weight to Brightcove Inc (NASDAQ:BCOV), around 17.84% of its 13F portfolio. Trigran Investments is also relatively very bullish on the stock, setting aside 7.93 percent of its 13F equity portfolio to BCOV.

Seeing as Brightcove Inc (NASDAQ:BCOV) has witnessed bearish sentiment from the smart money, logic holds that there is a sect of money managers that decided to sell off their full holdings in the third quarter. Intriguingly, Bruce Kovner’s Caxton Associates LP dropped the largest investment of all the hedgies followed by Insider Monkey, valued at an estimated $0.3 million in stock. Peter Muller’s fund, PDT Partners, also said goodbye to its stock, about $0.2 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Brightcove Inc (NASDAQ:BCOV) but similarly valued. We will take a look at The Lovesac Company (NASDAQ:LOVE), AnaptysBio, Inc. (NASDAQ:ANAB), Allied Motion Technologies, Inc. (NASDAQ:AMOT), Yunji Inc. (NASDAQ:YJ), TFF Pharmaceuticals, Inc. (NASDAQ:TFFP), Waterstone Financial, Inc. (NASDAQ:WSBF), and Duluth Holdings Inc. (NASDAQ:DLTH). This group of stocks’ market caps resemble BCOV’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
LOVE 9 35135 -2
ANAB 24 241528 -2
AMOT 12 49767 -1
YJ 4 1496 0
TFFP 6 66934 2
WSBF 10 68922 -4
DLTH 11 13591 3
Average 10.9 68196 -0.6

View table here if you experience formatting issues.

As you can see these stocks had an average of 10.9 hedge funds with bullish positions and the average amount invested in these stocks was $68 million. That figure was $158 million in BCOV’s case. AnaptysBio, Inc. (NASDAQ:ANAB) is the most popular stock in this table. On the other hand Yunji Inc. (NASDAQ:YJ) is the least popular one with only 4 bullish hedge fund positions. Brightcove Inc (NASDAQ:BCOV) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for BCOV is 67. 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. 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 December 14th and still beat the market by 15.8 percentage points. Hedge funds were also right about betting on BCOV as the stock returned 66.2% since the end of Q3 (through 12/14) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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