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In this article we will analyze whether ATN International, Inc. (NASDAQ:ATNI) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There's no better way to get these firms' immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market by double digits annually.
Is ATNI a good stock to buy now? The best stock pickers were turning bullish. The number of bullish hedge fund bets rose by 1 in recent months. ATN International, Inc. (NASDAQ:ATNI) was in 9 hedge funds' portfolios at the end of September. The all time high for this statistics is 10. Our calculations also showed that ATNI 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.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Michael Gelband of ExodusPoint Capital
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 let's go over the latest hedge fund action surrounding ATN International, Inc. (NASDAQ:ATNI).
Do Hedge Funds Think ATNI 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 were bullish on this stock, a change of 13% from the previous quarter. The graph below displays the number of hedge funds with bullish position in ATNI over the last 21 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in ATN International, Inc. (NASDAQ:ATNI) was held by Renaissance Technologies, which reported holding $30.9 million worth of stock at the end of September. It was followed by Royce & Associates with a $10.1 million position. Other investors bullish on the company included Third Avenue Management, Millennium Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Third Avenue Management allocated the biggest weight to ATN International, Inc. (NASDAQ:ATNI), around 0.5% of its 13F portfolio. Royce & Associates is also relatively very bullish on the stock, earmarking 0.11 percent of its 13F equity portfolio to ATNI.
Consequently, key hedge funds were breaking ground themselves. Millennium Management, managed by Israel Englander, assembled the biggest position in ATN International, Inc. (NASDAQ:ATNI). Millennium Management had $0.8 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also made a $0.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Michael Gelband's ExodusPoint Capital and Donald Sussman's Paloma Partners.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as ATN International, Inc. (NASDAQ:ATNI) but similarly valued. We will take a look at Twin River Worldwide Holdings Inc. (NYSE:TRWH), Huami Corporation (NYSE:HMI), Sohu.com Limited (NASDAQ:SOHU), RadNet Inc. (NASDAQ:RDNT), Columbus McKinnon Corporation (NASDAQ:CMCO), ArcBest Corp (NASDAQ:ARCB), and Cellectis SA (NASDAQ:CLLS). This group of stocks' market caps match ATNI's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TRWH,17,164279,-1 HMI,7,14122,1 SOHU,14,111806,0 RDNT,13,53528,-1 CMCO,17,32949,0 ARCB,17,66107,5 CLLS,8,20311,-5 Average,13.3,66157,-0.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.3 hedge funds with bullish positions and the average amount invested in these stocks was $66 million. That figure was $48 million in ATNI's case. Twin River Worldwide Holdings Inc. (NYSE:TRWH) is the most popular stock in this table. On the other hand Huami Corporation (NYSE:HMI) is the least popular one with only 7 bullish hedge fund positions. ATN International, Inc. (NASDAQ:ATNI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ATNI is 43. 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 negative signal and 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 surpassed the market again by 16.2 percentage points. Unfortunately ATNI wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); ATNI investors were disappointed as the stock returned -5.5% 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 most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.