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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 817 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Aspen Group Inc. (NASDAQ:ASPU), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is ASPU a good stock to buy now? Aspen Group Inc. (NASDAQ:ASPU) was in 9 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistic is 10. ASPU investors should be aware of a decrease in hedge fund sentiment lately. There were 10 hedge funds in our database with ASPU holdings at the end of June. Our calculations also showed that ASPU isn't among the 30 most popular stocks among hedge funds (click for Q3 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.
If you'd ask most traders, hedge funds are perceived as slow, outdated investment vehicles of yesteryear. While there are more than 8000 funds with their doors open today, We hone in on the elite of this club, approximately 850 funds. These money managers have their hands on bulk of all hedge funds' total capital, and by following their highest performing equity investments, Insider Monkey has deciphered a number of investment strategies that have historically exceeded Mr. Market. Insider Monkey's flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
Leon Cooperman of Omega Advisors
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind we're going to take a peek at the recent hedge fund action encompassing Aspen Group Inc. (NASDAQ:ASPU).
Do Hedge Funds Think ASPU Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -10% from the previous quarter. By comparison, 3 hedge funds held shares or bullish call options in ASPU a year ago. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Aspen Group Inc. (NASDAQ:ASPU) was held by Omega Advisors, which reported holding $11.2 million worth of stock at the end of September. It was followed by Driehaus Capital with a $8 million position. Other investors bullish on the company included Royce & Associates, Voss Capital, and P.A.W. CAPITAL PARTNERS. In terms of the portfolio weights assigned to each position P.A.W. CAPITAL PARTNERS allocated the biggest weight to Aspen Group Inc. (NASDAQ:ASPU), around 2.43% of its 13F portfolio. Voss Capital is also relatively very bullish on the stock, designating 2.39 percent of its 13F equity portfolio to ASPU.
Seeing as Aspen Group Inc. (NASDAQ:ASPU) has witnessed falling interest from hedge fund managers, we can see that there were a few hedge funds who were dropping their positions entirely by the end of the third quarter. Intriguingly, Israel Englander's Millennium Management sold off the biggest position of all the hedgies followed by Insider Monkey, comprising close to $2.1 million in stock. Josh Goldberg's fund, G2 Investment Partners Management, also sold off its stock, about $0.4 million worth. These transactions are important to note, as aggregate hedge fund interest was cut by 1 funds by the end of the third quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Aspen Group Inc. (NASDAQ:ASPU) but similarly valued. We will take a look at AXT Inc (NASDAQ:AXTI), Northern Oil & Gas, Inc. (NYSE:NOG), Enterprise Bancorp, Inc (NASDAQ:EBTC), Retail Value Inc. (NYSE:RVI), Chiasma Inc (NASDAQ:CHMA), Checkmate Pharmaceuticals, Inc. (NASDAQ:CMPI), and NuZee, Inc. (NASDAQ:NUZE). This group of stocks' market valuations resemble ASPU's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position AXTI,8,15855,-4 NOG,12,29194,-10 EBTC,2,955,1 RVI,15,75281,-1 CHMA,15,63581,1 CMPI,5,23436,5 NUZE,1,173,1 Average,8.3,29782,-1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 8.3 hedge funds with bullish positions and the average amount invested in these stocks was $30 million. That figure was $33 million in ASPU's case. Retail Value Inc. (NYSE:RVI) is the most popular stock in this table. On the other hand NuZee, Inc. (NASDAQ:NUZE) is the least popular one with only 1 bullish hedge fund positions. Aspen Group Inc. (NASDAQ:ASPU) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for ASPU is 59.6. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and beat the market again by 16.2 percentage points. Unfortunately ASPU wasn't nearly as popular as these 20 stocks and hedge funds that were betting on ASPU were disappointed as the stock returned 2.6% since the end of September (through 12/8) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
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Disclosure: None. This article was originally published at Insider Monkey.