LeMaitre Vascular Inc (LMAT): Hedge Funds Are Turning Bearish

We at Insider Monkey have gone over 821 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 March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of LeMaitre Vascular Inc (NASDAQ:LMAT) based on that data.

Is LeMaitre Vascular Inc (NASDAQ:LMAT) worth your attention right now? Prominent investors are taking a pessimistic view. The number of long hedge fund positions fell by 3 in recent months. Our calculations also showed that LMAT isn’t among the 30 most popular stocks among hedge funds (click for Q1 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.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 58 percentage points since March 2017 (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 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Noam Gottesman GLG Partners

Noam Gottesman of GLG Partners

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let’s go over the fresh hedge fund action surrounding LeMaitre Vascular Inc (NASDAQ:LMAT).

Hedge fund activity in LeMaitre Vascular Inc (NASDAQ:LMAT)

At Q1’s end, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -33% from the previous quarter. By comparison, 11 hedge funds held shares or bullish call options in LMAT a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is LMAT A Good Stock To Buy?

The largest stake in LeMaitre Vascular Inc (NASDAQ:LMAT) was held by Winton Capital Management, which reported holding $1.5 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $1.1 million position. Other investors bullish on the company included AQR Capital Management, Citadel Investment Group, and Engineers Gate Manager. In terms of the portfolio weights assigned to each position Winton Capital Management allocated the biggest weight to LeMaitre Vascular Inc (NASDAQ:LMAT), around 0.04% of its 13F portfolio. Engineers Gate Manager is also relatively very bullish on the stock, dishing out 0.02 percent of its 13F equity portfolio to LMAT.

Because LeMaitre Vascular Inc (NASDAQ:LMAT) has witnessed a decline in interest from the smart money, it’s safe to say that there exists a select few money managers who were dropping their entire stakes by the end of the first quarter. Interestingly, Peter Algert and Kevin Coldiron’s Algert Coldiron Investors dumped the biggest investment of all the hedgies monitored by Insider Monkey, worth about $0.9 million in stock, and John Overdeck and David Siegel’s Two Sigma Advisors was right behind this move, as the fund dumped about $0.6 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 3 funds by the end of the first quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as LeMaitre Vascular Inc (NASDAQ:LMAT) but similarly valued. These stocks are Camping World Holdings, Inc. (NYSE:CWH), Live Oak Bancshares Inc (NASDAQ:LOB), Goldman Sachs BDC, Inc. (NYSE:GSBD), and Forestar Group Inc. (NYSE:FOR). All of these stocks’ market caps match LMAT’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
CWH 16 67549 1
LOB 10 25016 0
GSBD 1 1946 -1
FOR 7 52227 -5
Average 8.5 36685 -1.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 8.5 hedge funds with bullish positions and the average amount invested in these stocks was $37 million. That figure was $5 million in LMAT’s case. Camping World Holdings, Inc. (NYSE:CWH) is the most popular stock in this table. On the other hand Goldman Sachs BDC, Inc. (NYSE:GSBD) is the least popular one with only 1 bullish hedge fund positions. LeMaitre Vascular Inc (NASDAQ:LMAT) 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. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th and surpassed the market by 14.2 percentage points. Unfortunately LMAT wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); LMAT investors were disappointed as the stock returned 4.4% during the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

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Disclosure: None. This article was originally published at Insider Monkey.