The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider Health Insurance Innovations Inc (NASDAQ:HIIQ) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is Health Insurance Innovations Inc (NASDAQ:HIIQ) going to take off soon? Prominent investors are taking a bearish view. The number of long hedge fund bets shrunk by 4 lately. Our calculations also showed that HIIQ isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 24% through December 3, 2018. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We’re going to take a gander at the recent hedge fund action encompassing Health Insurance Innovations Inc (NASDAQ:HIIQ).
What does the smart money think about Health Insurance Innovations Inc (NASDAQ:HIIQ)?
Heading into the fourth quarter of 2018, a total of 17 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -19% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards HIIQ over the last 13 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
The largest stake in Health Insurance Innovations Inc (NASDAQ:HIIQ) was held by Renaissance Technologies, which reported holding $60.2 million worth of stock at the end of September. It was followed by P2 Capital Partners with a $51.2 million position. Other investors bullish on the company included Cannell Capital, Arrowstreet Capital, and Cardinal Capital.
Because Health Insurance Innovations Inc (NASDAQ:HIIQ) has faced bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there was a specific group of money managers that slashed their positions entirely by the end of the third quarter. Interestingly, Israel Englander’s Millennium Management sold off the biggest investment of the “upper crust” of funds monitored by Insider Monkey, comprising about $8.7 million in stock. Steve Cohen’s fund, Point72 Asset Management, also dropped its stock, about $7.8 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 4 funds by the end of the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Health Insurance Innovations Inc (NASDAQ:HIIQ) but similarly valued. We will take a look at Karyopharm Therapeutics Inc (NASDAQ:KPTI), New Mountain Finance Corp. (NYSE:NMFC), Owens & Minor, Inc. (NYSE:OMI), and The St. Joe Company (NYSE:JOE). This group of stocks’ market caps resemble HIIQ’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| KPTI | 18 | 216629 | 4 |
| NMFC | 12 | 20113 | 1 |
| OMI | 11 | 41574 | -2 |
| JOE | 15 | 512263 | 1 |
| Average | 14 | 197645 | 1 |
View table here if you experience formatting issues.
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 $198 million. That figure was $260 million in HIIQ’s case. Karyopharm Therapeutics Inc (NASDAQ:KPTI) is the most popular stock in this table. On the other hand Owens & Minor, Inc. (NYSE:OMI) is the least popular one with only 11 bullish hedge fund positions. Health Insurance Innovations Inc (NASDAQ:HIIQ) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard KPTI might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.
