The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of International Money Express, Inc. (NASDAQ:IMXI).
International Money Express, Inc. (NASDAQ:IMXI) has experienced a decrease in hedge fund sentiment recently. IMXI was in 9 hedge funds' portfolios at the end of March. There were 14 hedge funds in our database with IMXI positions at the end of the previous quarter. Our calculations also showed that IMXI isn't among the 30 most popular stocks among hedge funds (click for Q1 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.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 58 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 36% through May 18th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
[caption id="attachment_670993" align="aligncenter" width="399"] Will Harkey of Nantahala Capital Management[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, We take a look at lists like the 10 most profitable companies in the world to identify the compounders that are likely to deliver double digit returns. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind we're going to analyze the recent hedge fund action encompassing International Money Express, Inc. (NASDAQ:IMXI).
What does smart money think about International Money Express, Inc. (NASDAQ:IMXI)?
At Q1's end, a total of 9 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -36% from the previous quarter. The graph below displays the number of hedge funds with bullish position in IMXI over the last 18 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey's hedge fund database, Wilmot B. Harkey and Daniel Mack's Nantahala Capital Management has the number one position in International Money Express, Inc. (NASDAQ:IMXI), worth close to $26.5 million, amounting to 1% of its total 13F portfolio. Sitting at the No. 2 spot is Parsa Kiai of Steamboat Capital Partners, with a $23.4 million position; 4.6% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions comprise David Park's Headlands Capital, David Harding's Winton Capital Management and Joseph Samuels's Islet Management. In terms of the portfolio weights assigned to each position Headlands Capital allocated the biggest weight to International Money Express, Inc. (NASDAQ:IMXI), around 16.2% of its 13F portfolio. Steamboat Capital Partners is also relatively very bullish on the stock, designating 4.6 percent of its 13F equity portfolio to IMXI.
Since International Money Express, Inc. (NASDAQ:IMXI) has faced falling interest from the smart money, we can see that there exists a select few hedge funds that elected to cut their positions entirely by the end of the first quarter. At the top of the heap, George McCabe's Portolan Capital Management sold off the largest investment of the "upper crust" of funds monitored by Insider Monkey, worth about $5.2 million in stock, and Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital was right behind this move, as the fund dropped about $2.4 million worth. These moves are important to note, as total hedge fund interest was cut by 5 funds by the end of the first quarter.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as International Money Express, Inc. (NASDAQ:IMXI) but similarly valued. These stocks are Artesian Resources Corporation (NASDAQ:ARTNA), The Bancorp, Inc. (NASDAQ:TBBK), Mercantile Bank Corp. (NASDAQ:MBWM), and Adesto Technologies Corporation (NASDAQ:IOTS). This group of stocks' market values resemble IMXI's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ARTNA,3,15815,0 TBBK,15,44580,-3 MBWM,4,21903,-2 IOTS,15,76816,0 Average,9.25,39779,-1.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $40 million. That figure was $67 million in IMXI's case. The Bancorp, Inc. (NASDAQ:TBBK) is the most popular stock in this table. On the other hand Artesian Resources Corporation (NASDAQ:ARTNA) is the least popular one with only 3 bullish hedge fund positions. International Money Express, Inc. (NASDAQ:IMXI) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.4% in 2020 through June 22nd and still beat the market by 15.9 percentage points. A small number of hedge funds were also right about betting on IMXI as the stock returned 30.3% during the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.