We at Insider Monkey have gone over 817 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 September 30th. In this article, we look at what those funds think of Bottomline Technologies (NASDAQ:EPAY) based on that data.
Is EPAY a good stock to buy now? Hedge funds were betting on the stock. The number of bullish hedge fund bets went up by 3 recently. Bottomline Technologies (NASDAQ:EPAY) was in 21 hedge funds’ portfolios at the end of September. The all time high for this statistic is 22. Our calculations also showed that EPAY 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).
Video: Watch our video about the top 5 most popular hedge fund stocks.
If you’d ask most shareholders, hedge funds are assumed to be slow, old financial vehicles of years past. While there are more than 8000 funds with their doors open at the moment, Our researchers hone in on the upper echelon of this group, around 850 funds. These investment experts oversee the lion’s share of the hedge fund industry’s total asset base, and by tailing their inimitable stock picks, Insider Monkey has found a few investment strategies that have historically outstripped the broader indices. 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 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 .
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. Keeping this in mind let’s go over the latest hedge fund action surrounding Bottomline Technologies (NASDAQ:EPAY).
Do Hedge Funds Think EPAY Is A Good Stock To Buy Now?
At the end of September, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 17% from one quarter earlier. On the other hand, there were a total of 22 hedge funds with a bullish position in EPAY a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, MIG Capital held the most valuable stake in Bottomline Technologies (NASDAQ:EPAY), which was worth $45.5 million at the end of the third quarter. On the second spot was GLG Partners which amassed $14.9 million worth of shares. Arrowstreet Capital, Nishkama Capital, 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 MIG Capital allocated the biggest weight to Bottomline Technologies (NASDAQ:EPAY), around 4.63% of its 13F portfolio. Nishkama Capital is also relatively very bullish on the stock, setting aside 3.9 percent of its 13F equity portfolio to EPAY.
As industrywide interest jumped, specific money managers have jumped into Bottomline Technologies (NASDAQ:EPAY) headfirst. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the largest position in Bottomline Technologies (NASDAQ:EPAY). Marshall Wace LLP had $4.2 million invested in the company at the end of the quarter. Benjamin A. Smith’s Laurion Capital Management also made a $0.4 million investment in the stock during the quarter. The other funds with new positions in the stock are Donald Sussman’s Paloma Partners and Peter Muller’s PDT Partners.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Bottomline Technologies (NASDAQ:EPAY) but similarly valued. We will take a look at 21Vianet Group Inc (NASDAQ:VNET), Asbury Automotive Group, Inc. (NYSE:ABG), First Hawaiian, Inc. (NASDAQ:FHB), Daqo New Energy Corp (NYSE:DQ), Comfort Systems USA, Inc. (NYSE:FIX), Fitbit Inc (NYSE:FIT), and Nordstrom, Inc. (NYSE:JWN). This group of stocks’ market caps match EPAY’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 25.4 hedge funds with bullish positions and the average amount invested in these stocks was $241 million. That figure was $123 million in EPAY’s case. Fitbit Inc (NYSE:FIT) is the most popular stock in this table. On the other hand Daqo New Energy Corp (NYSE:DQ) is the least popular one with only 18 bullish hedge fund positions. Bottomline Technologies (NASDAQ:EPAY) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for EPAY is 47.4. 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. A small number of hedge funds were also right about betting on EPAY as the stock returned 18.8% since the end of the third quarter (through 12/14) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.