With all three indices in the red today, shares of Cadiz Inc (NASDAQ:CDZI), Giga-tronics, Incorporated (NASDAQ:GIGA), MeetMe Inc (NASDAQ:MEET), Solaredge Technologies Inc (NASDAQ:SEDG) and Universal Display Corporation (NASDAQ:OLED) are well in the green. Let’s find out why investors are buying these five stocks today. We are also going to assess the hedge fund sentiment towards these stocks.
We pay attention to hedge funds’ moves because our research has shown that hedge funds are extremely talented at picking stocks on the long side of their portfolios. It is true that hedge fund investors have been underperforming the market in recent years. However, this was mainly because hedge funds’ short stock picks lost a ton of money during the bull market that started in March 2009. Hedge fund investors also paid an arm and a leg for the services that they received. We have been tracking the performance of hedge funds’ 15 most popular small-cap stock picks in real time since the end of August 2012. These stocks have returned 102% since then and outperformed the S&P 500 Index by around 53 percentage points (see more details here). That’s why we believe it is important to pay attention to the hedge fund sentiment; we also don’t like paying huge fees.
In Wednesday intraday trading, Cadiz Inc (NASDAQ:CDZI)’s stock is up by nearly 30% after the company entered into a lease agreement with Water Asset Management (WAM). Under the agreement, WAM will lease 2,100 acres owned by Cadiz in San Bernardino County, California, to be used for various purposes, such as planting, growing and harvesting of crops. Cadiz will receive a one-time payment of $12 million. Both companies also agreed that Cadiz can negotiate exclusively with WAM another future lease of 7,500 acres for a proposed price of $43 million. Hedge fund sentiment towards Cadiz Inc (NASDAQ:CDZI) has been steady, as the number of hedge funds long the stock (among those we follow) remained unchanged, at six, at the end of the third quarter. Moreover, these funds amassed 15.60% of the company’s outstanding stock heading into the fourth quarter. Crispin Odey‘s Odey Asset Management reported owning 2.1 million shares of Cadiz Inc (NASDAQ:CDZI) in its latest 13F filing, having increased its stake by 9% over the quarter.
Moving on, Giga-tronics, Incorporated (NASDAQ:GIGA) shares have surged by 21% on Wednesday. At the beginning of the month, the company announced a license agreement with Lockheed Martin Corporation (NYSE:LMT), but the financial conditions of the accord were not disclosed. Among the funds we follow, Giga-tronics, Incorporated (NASDAQ:GIGA) is not very popular with only two funds reporting long positions in the last round of 13F filings, amassing some 2.0% of its outstanding stock. Jim Simons‘ Renaissance Technologies owned 102,200 shares at the end of September.