We at Insider Monkey have gone over 738 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of March 31st. In this article, we look at what those funds think of Systemax Inc. (NYSE:SYX) based on that data.
Systemax Inc. (NYSE:SYX) investors should pay attention to an increase in activity from the world's largest hedge funds recently. Our calculations also showed that SYX isn't among the 30 most popular stocks among hedge funds.
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 flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We're going to take a peek at the fresh hedge fund action regarding Systemax Inc. (NYSE:SYX).
How have hedgies been trading Systemax Inc. (NYSE:SYX)?
Heading into the second quarter of 2019, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 9% from the previous quarter. The graph below displays the number of hedge funds with bullish position in SYX over the last 15 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, AQR Capital Management was the largest shareholder of Systemax Inc. (NYSE:SYX), with a stake worth $7.6 million reported as of the end of March. Trailing AQR Capital Management was Royce & Associates, which amassed a stake valued at $4.3 million. Renaissance Technologies, Citadel Investment Group, and Portolan Capital Management were also very fond of the stock, giving the stock large weights in their portfolios.
As aggregate interest increased, some big names have jumped into Systemax Inc. (NYSE:SYX) headfirst. Caxton Associates LP, managed by Bruce Kovner, created the most valuable position in Systemax Inc. (NYSE:SYX). Caxton Associates LP had $0.3 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital also made a $0.3 million investment in the stock during the quarter.
Let's check out hedge fund activity in other stocks similar to Systemax Inc. (NYSE:SYX). These stocks are PlayAGS, Inc. (NYSE:AGS), QAD Inc. (NASDAQ:QADA), CBTX, Inc. (NASDAQ:CBTX), and Intrexon Corp (NASDAQ:XON). This group of stocks' market caps are similar to SYX's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position AGS,22,130434,11 QADA,16,124879,-1 CBTX,8,22427,0 XON,8,11013,-2 Average,13.5,72188,2 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.5 hedge funds with bullish positions and the average amount invested in these stocks was $72 million. That figure was $23 million in SYX's case. PlayAGS, Inc. (NYSE:AGS) is the most popular stock in this table. On the other hand CBTX, Inc. (NASDAQ:CBTX) is the least popular one with only 8 bullish hedge fund positions. Systemax Inc. (NYSE:SYX) is not the least popular stock in this group but hedge fund interest is still below average. 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 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately SYX wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); SYX investors were disappointed as the stock returned -4.9% during the same time period 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 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.