The Insider Monkey team has completed processing the quarterly 13F filings for the March quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards TechTarget Inc (NASDAQ:TTGT).
Is TTGT a good stock to buy? Prominent investors were getting less optimistic. The number of long hedge fund positions were trimmed by 1 recently. TechTarget Inc (NASDAQ:TTGT) was in 17 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 18. Our calculations also showed that TTGT isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
In the eyes of most traders, hedge funds are viewed as underperforming, outdated financial tools of years past. While there are greater than 8000 funds trading at the moment, Our experts choose to focus on the top tier of this club, approximately 850 funds. Most estimates calculate that this group of people manage bulk of all hedge funds' total asset base, and by monitoring their top equity investments, Insider Monkey has spotted numerous investment strategies that have historically defeated the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Also, our monthly newsletter's portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .
Joel Greenblatt of Gotham Asset Management
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Do Hedge Funds Think TTGT Is A Good Stock To Buy Now?
At the end of the first quarter, a total of 17 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -6% from the fourth quarter of 2020. By comparison, 14 hedge funds held shares or bullish call options in TTGT a year ago. With hedge funds' capital changing hands, there exists an "upper tier" of notable hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
The largest stake in TechTarget Inc (NASDAQ:TTGT) was held by Renaissance Technologies, which reported holding $68.3 million worth of stock at the end of December. It was followed by G2 Investment Partners Management with a $15.3 million position. Other investors bullish on the company included GLG Partners, Millennium Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position G2 Investment Partners Management allocated the biggest weight to TechTarget Inc (NASDAQ:TTGT), around 2.42% of its 13F portfolio. Montanaro Asset Management is also relatively very bullish on the stock, dishing out 1.2 percent of its 13F equity portfolio to TTGT.
Judging by the fact that TechTarget Inc (NASDAQ:TTGT) has faced a decline in interest from the smart money, logic holds that there lies a certain "tier" of funds that slashed their positions entirely last quarter. At the top of the heap, David Harding's Winton Capital Management sold off the largest investment of the "upper crust" of funds watched by Insider Monkey, valued at close to $1.7 million in stock. Benjamin A. Smith's fund, Laurion Capital Management, also dumped its stock, about $1.1 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 1 funds last quarter.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as TechTarget Inc (NASDAQ:TTGT) but similarly valued. We will take a look at Dicerna Pharmaceuticals Inc (NASDAQ:DRNA), Progress Software Corporation (NASDAQ:PRGS), Pretium Resources Inc (NYSE:PVG), McGrath RentCorp (NASDAQ:MGRC), KAR Auction Services Inc (NYSE:KAR), Gevo, Inc. (NASDAQ:GEVO), and The Buckle, Inc. (NYSE:BKE). This group of stocks' market values are closest to TTGT's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position DRNA,27,294797,-2 PRGS,18,154642,2 PVG,22,154632,0 MGRC,13,66010,-7 KAR,22,161089,-5 GEVO,6,61483,-1 BKE,22,77783,10 Average,18.6,138634,-0.4 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.6 hedge funds with bullish positions and the average amount invested in these stocks was $139 million. That figure was $129 million in TTGT's case. Dicerna Pharmaceuticals Inc (NASDAQ:DRNA) is the most popular stock in this table. On the other hand Gevo, Inc. (NASDAQ:GEVO) is the least popular one with only 6 bullish hedge fund positions. TechTarget Inc (NASDAQ:TTGT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TTGT is 58.5. 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 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 28.5% in 2021 through July 23rd and surpassed the market again by 10.1 percentage points. Unfortunately TTGT wasn't nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); TTGT investors were disappointed as the stock returned 7.1% since the end of March (through 7/23) 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 most of these stocks already outperformed the market in 2021.
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Disclosure: None. This article was originally published at Insider Monkey.