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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 June. At Insider Monkey, we follow nearly 900 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 Synchronoss Technologies, Inc. (NASDAQ:SNCR), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Synchronoss Technologies, Inc. (NASDAQ:SNCR) was in 22 hedge funds' portfolios at the end of the second quarter of 2021. The all time high for this statistic was previously 12. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. SNCR has seen an increase in enthusiasm from smart money recently. There were 9 hedge funds in our database with SNCR positions at the end of the first quarter. Our calculations also showed that SNCR isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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. Hedge funds have more than $3.5 trillion in assets under management, so you can't expect their entire portfolios to beat the market by large margins. 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 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds' moves today.
Donald Sussman of Paloma Partners
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. 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 homepage. Keeping this in mind let's take a look at the key hedge fund action regarding Synchronoss Technologies, Inc. (NASDAQ:SNCR).
Do Hedge Funds Think SNCR Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 144% from the previous quarter. On the other hand, there were a total of 10 hedge funds with a bullish position in SNCR a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Synchronoss Technologies, Inc. (NASDAQ:SNCR) was held by Cannell Capital, which reported holding $8 million worth of stock at the end of June. It was followed by Portolan Capital Management with a $5.1 million position. Other investors bullish on the company included Nokomis Capital, Renaissance Technologies, and G2 Investment Partners Management. In terms of the portfolio weights assigned to each position Nokomis Capital allocated the biggest weight to Synchronoss Technologies, Inc. (NASDAQ:SNCR), around 1.3% of its 13F portfolio. Cannell Capital is also relatively very bullish on the stock, designating 1.28 percent of its 13F equity portfolio to SNCR.
With a general bullishness amongst the heavyweights, some big names have jumped into Synchronoss Technologies, Inc. (NASDAQ:SNCR) headfirst. Cannell Capital, managed by J. Carlo Cannell, initiated the most outsized position in Synchronoss Technologies, Inc. (NASDAQ:SNCR). Cannell Capital had $8 million invested in the company at the end of the quarter. George McCabe's Portolan Capital Management also initiated a $5.1 million position during the quarter. The other funds with brand new SNCR positions are Brett Hendrickson's Nokomis Capital, Israel Englander's Millennium Management, and Gavin Saitowitz and Cisco J. del Valle's Prelude Capital (previously Springbok Capital).
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Synchronoss Technologies, Inc. (NASDAQ:SNCR) but similarly valued. We will take a look at Inspired Entertainment, Inc. (NASDAQ:INSE), Ring Energy Inc (NYSE:REI), Arbutus Biopharma Corp (NASDAQ:ABUS), Western Copper and Gold Corporation (NYSE:WRN), Aenza S.A.A. (NYSE:AENZ), Tuniu Corporation (NASDAQ:TOUR), and Nathan's Famous, Inc. (NASDAQ:NATH). This group of stocks' market caps resemble SNCR's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position INSE,23,121134,15 REI,8,2241,1 ABUS,5,9559,-10 WRN,3,1451,1 AENZ,1,70,0 TOUR,5,16380,-1 NATH,4,33449,0 Average,7,26326,0.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $26 million. That figure was $34 million in SNCR's case. Inspired Entertainment, Inc. (NASDAQ:INSE) is the most popular stock in this table. On the other hand Aenza S.A.A. (NYSE:AENZ) is the least popular one with only 1 bullish hedge fund positions. Synchronoss Technologies, Inc. (NASDAQ:SNCR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SNCR is 87.7. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 24% in 2021 through October 22nd and beat the market again by 1.6 percentage points. Unfortunately SNCR wasn't nearly as popular as these 5 stocks and hedge funds that were betting on SNCR were disappointed as the stock returned -32.3% since the end of June (through 10/22) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.