Investing in hedge funds can bring large profits, but it’s not for everybody, since hedge funds are available only for high-net-worth individuals. They generate significant returns for investors to justify their large fees and they allocate a lot of time and employ a complex analysis to determine the best stocks to invest in. A particularly interesting group of stocks that hedge funds like is the small-caps. The huge amount of capital does not allow hedge funds to invest a lot in small-caps, but our research showed that their most popular small-cap ideas are less efficiently priced and generate stronger returns than their large- and mega-cap picks and the broader market. That is why we follow the hedge fund activity in the small-cap space.
Comtech Telecomm. Corp. (NASDAQ:CMTL) was in 11 hedge funds’ portfolios at the end of the third quarter of 2016. CMTL investors should be aware of a decrease in hedge fund interest lately. There were 17 hedge funds in our database with CMTL positions at the end of the previous quarter. At the end of this article we will also compare CMTL to other stocks including Stemline Therapeutics Inc (NASDAQ:STML), Medgenics Inc (NASDAQ:MDGN), and Evolution Petroleum Corporation (NYSEMKT:EPM) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
With all of this in mind, we’re going to take a look at the fresh action regarding Comtech Telecomm. Corp. (NASDAQ:CMTL).
How are hedge funds trading Comtech Telecomm. Corp. (NASDAQ:CMTL)?
Heading into the fourth quarter of 2016, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 35% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards CMTL over the last 5 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Of the funds tracked by Insider Monkey, Joe Huber’s Huber Capital Management has the most valuable position in Comtech Telecomm. Corp. (NASDAQ:CMTL), worth close to $14.7 million, amounting to 0.6% of its total 13F portfolio. The second largest stake is held by Royce & Associates, led by Chuck Royce, which holds a $12.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers with similar optimism include Renaissance Technologies, one of the biggest hedge funds in the world, Ken Griffin’s Citadel Investment Group and John Overdeck and David Siegel’s Two Sigma Advisors. 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.