Is SAExploration Holdings, Inc. (SAEX) A Good Stock To Buy?

It is already common knowledge that individual investors do not usually have the necessary resources and abilities to properly research an investment opportunity. As a result, most investors pick their illusory “winners” by making a superficial analysis and research that leads to poor performance on aggregate. The Standard and Poor’s 500 Index returned 7.6% over the 12-month period ending November 21, while more than 51% of the constituents of the index underperformed the benchmark. Hence, a random stock picking process will most likely lead to disappointment. At the same time, the 30 most favored mid-cap stocks by the best performing hedge funds monitored by Insider Monkey generated a return of 18% over the same time span. Of course, hedge funds do make wrong bets on some occasions and these get disproportionately publicized on financial media, but piggybacking their moves can beat the broader market on average. That’s why we are going to go over recent hedge fund activity in SAExploration Holdings, Inc. (NASDAQ:SAEX) .

SAExploration Holdings, Inc. (NASDAQ:SAEX) investors should be aware of an increase in enthusiasm from smart money recently. There were 5 hedge funds in our database with SAEX positions at the end of the previous quarter. At the end of this article we will also compare SAEX to other stocks including Sunshine Bancorp Inc (NASDAQ:SBCP), Computer Task Group, Inc. (NASDAQ:CTG), and Cumulus Media Inc (NASDAQ:CMLS) to get a better sense of its popularity.

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Now, let’s take a look at the fresh action surrounding SAExploration Holdings, Inc. (NASDAQ:SAEX).

How are hedge funds trading SAExploration Holdings, Inc. (NASDAQ:SAEX)?

Heading into the fourth quarter of 2016, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 20% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in SAEX over the last 5 quarters. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).

saex

Of the funds tracked by Insider Monkey, Andy Redleaf’s Whitebox Advisors has the number one position in SAExploration Holdings, Inc. (NASDAQ:SAEX), worth close to $21.4 million, amounting to 0.9% of its total 13F portfolio. The second most bullish fund manager is Andrew Feldstein and Stephen Siderow of Blue Mountain Capital, with a $19.8 million position; 0.5% of its 13F portfolio is allocated to the stock. Other peers that are bullish include Noam Gottesman’s GLG Partners, Jim Simons’ Renaissance Technologies, one of the largest hedge funds in the world, and Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners. We should note that two of these hedge funds (Whitebox Advisors and GRT Capital Partners) 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.

Consequently, key money managers were breaking ground themselves. The other funds with brand new SAEX positions are  GRT Capital Partners and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.

Let’s now review hedge fund activity in other stocks similar to SAExploration Holdings, Inc. (NASDAQ:SAEX). These stocks are Sunshine Bancorp Inc (NASDAQ:SBCP), Computer Task Group, Inc. (NASDAQ:CTG), Cumulus Media Inc (NASDAQ:CMLS), and Universal Stainless & Alloy Products (NASDAQ:USAP). This group of stocks’ market caps resemble SAEX’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
SBCP 6 13812 1
CTG 5 12226 0
CMLS 12 13298 -3
USAP 6 11348 -1

As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $13 million. That figure was $44 million in SAEX’s case. Cumulus Media Inc (NASDAQ:CMLS) is the most popular stock in this table. On the other hand Computer Task Group, Inc. (NASDAQ:CTG) is the least popular one with only 5 bullish hedge fund positions. SAExploration Holdings, Inc. (NASDAQ:SAEX) 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 CMLS might be a better candidate to consider taking a long position in.