Is Q2 Holdings Inc (QTWO) Going to Burn Investors?

Since Q2 Holdings Inc (NYSE:QTWO) has sustained bearish sentiment from the aggregate hedge fund industry, it’s easy to see that there is a sect of money managers that elected to cut their entire stakes in the third quarter. Interestingly, Seymour Sy Kaufman and Michael Stark’s Crosslink Capital cut the largest stake of all the investors monitored by Insider Monkey, totaling about $6 million in stock. Drew Cupps’ fund, Cupps Capital Management, also dumped its stock, about $2.4 million worth.

Let’s check out hedge fund activity in other stocks similar to Q2 Holdings Inc (NYSE:QTWO). We will take a look at Tennant Company (NYSE:TNC), Super Micro Computer, Inc. (NASDAQ:SMCI), Oxford Industries, Inc. (NYSE:OXM), and Beneficial Mutual Bancorp Inc (NASDAQ:BNCL). This group of stocks’ market caps are closest to QTWO’s market cap.

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $102 million. That figure was $36 million in QTWO’s case. Oxford Industries, Inc. (NYSE:OXM) is the most popular stock in this table. On the other hand Tennant Company (NYSE:TNC) is the least popular one with only 10 bullish hedge fund positions. Q2 Holdings Inc (NYSE:QTWO) 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 OXM might be a better candidate to consider taking a long position in.

Disclosure: None