Insider Monkey finished processing more than 700 13F filings made by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30. What do these smart investors think about Zumiez Inc. (NASDAQ:ZUMZ)?
Zumiez Inc. (NASDAQ:ZUMZ) shareholders have witnessed an increase in hedge fund interest in recent months. ZUMZ was in 12 hedge funds’ portfolios at the end of the third quarter of 2015. There were 11 hedge funds in our database with ZUMZ positions at the end of the previous quarter. At the end of this article we will also compare ZUMZ to other stocks including State National Companies Inc (NASDAQ:SNC), Infinity Pharmaceuticals Inc. (NASDAQ:INFI), and Myers Industries, Inc. (NYSE:MYE) to get a better sense of its popularity.
Follow Zumiez Inc (NASDAQ:ZUMZ)
Follow Zumiez Inc (NASDAQ:ZUMZ)
If you’d ask most market participants, hedge funds are seen as worthless, outdated investment vehicles of the past. While there are greater than 8000 funds in operation at present, Our researchers choose to focus on the crème de la crème of this group, approximately 700 funds. It is estimated that this group of investors watch over the lion’s share of all hedge funds’ total asset base, and by tracking their unrivaled stock picks, Insider Monkey has unsheathed many investment strategies that have historically outrun the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points annually for a decade in their back tests.
Keeping this in mind, let’s take a look at the latest action encompassing Zumiez Inc. (NASDAQ:ZUMZ).
Hedge fund activity in Zumiez Inc. (NASDAQ:ZUMZ)
Heading into Q4, a total of 12 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 9% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Chuck Royce’s Royce & Associates has the largest position in Zumiez Inc. (NASDAQ:ZUMZ), worth close to $4.3 million, amounting to less than 0.1% of its total 13F portfolio. Coming in second is Point72 Asset Management, managed by Steve Cohen, which holds an $4.2 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Remaining professional money managers that are bullish comprise Richard Chilton’s Chilton Investment Company, Jim Simons’s Renaissance Technologies and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
As industrywide interest jumped, key money managers have been driving this bullishness. Point72 Asset Management, managed by Steve Cohen, assembled the most outsized position in Zumiez Inc. (NASDAQ:ZUMZ). Point72 Asset Management had $4.2 million invested in the company at the end of the quarter. Richard Chilton’s Chilton Investment Company also made an $2.7 million investment in the stock during the quarter. The following funds were also among the new ZUMZ investors: Glenn Russell Dubin’s Highbridge Capital Management, Ken Gray and Steve Walsh’s Bryn Mawr Capital, and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Zumiez Inc. (NASDAQ:ZUMZ) but similarly valued. We will take a look at State National Companies Inc (NASDAQ:SNC), Infinity Pharmaceuticals Inc. (NASDAQ:INFI), Myers Industries, Inc. (NYSE:MYE), and Omeros Corporation (NASDAQ:OMER). This group of stocks’ market valuations are closest to ZUMZ’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SNC | 10 | 158235 | 0 |
| INFI | 20 | 100354 | -1 |
| MYE | 7 | 66386 | 1 |
| OMER | 12 | 53796 | -2 |
As you can see these stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $95 million. That figure was $18 million in ZUMZ’s case. Infinity Pharmaceuticals Inc. (NASDAQ:INFI) is the most popular stock in this table. On the other hand Myers Industries, Inc. (NYSE:MYE) is the least popular one with only 7 bullish hedge fund positions. Zumiez Inc. (NASDAQ:ZUMZ) 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 INFI might be a better candidate to consider a long position.
