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Here’s Why Digital Turbine (APPS) Stock is an Attractive Pick for Investors

Alex Smith
·4 mins read

If you are looking for the best ideas for your portfolio you may want to consider some of Greenhaven Road Capital's top stock picks. Greenhaven Road Capital, an investment management firm, is bullish on Digital Turbine Inc. (NASDAQ:APPS) stock. In its Q2 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Digital Turbine Inc. (NASDAQ:APPS) stock. Digital Turbine Inc. (NASDAQ:APPS) is a software company.

On August 1, 2019, Greenhaven Road Capital had released its Q2 2019 investor letter. Digital Turbine Inc. (NASDAQ:APPS) was one of the Top 5 holdings of Greenhaven in Q2 2019. The stock has posted a return of 236.2% in the trailing one year period, outperforming the S&P 500 Index which returned 20.0% in the same period. This suggests that the investment firm was right in its decision. On a year-to-date basis, Digital Turbine Inc. (NASDAQ:APPS) stock has risen by 245.2%.

Last month, we published an article revealing Greenhaven's bullish investment thesis on Digital Turbine Inc. (NASDAQ:APPS) stock in its Q2 2020 investor letter. This suggests that the investment firm has been bullish for a long time on Digital Turbine.

Greenhaven's fund posted a return of -4.0% in the second quarter of 2019, underperforming the S&P 500 Index which returned 4.3% in the same quarter. Let’s take a look at comments made by Greenhaven Road Capital about PAR Technology Corp (NYSE:PAR) in the Q2 2019 investor letter.

"Digital Turbine (APPS) – Discussed at length in the appendix of our last quarterly letter (linked here), our Digital Turbine thesis remains the same. Digital Turbine serves as a neutral third party that works with wireless carriers to pre-install apps on new cell phones, then sells the “slots” to app-driven companies such as Uber, Amazon, and Netflix. The company is in the early stages of a relationship with Samsung, the world’s largest cell phone manufacturer, to enable Digital Turbine to monetize in geographies where they do not yet have wireless carrier deals in place. Over time, I expect the number of devices as well as the revenue per device to increase materially. Both of these earnings drivers could go up 50%, and then if one layers in multiple expansion, share price can still appreciate significantly from here."

finance investing stock market trading -monitor-159888
finance investing stock market trading -monitor-159888

In Q1 2020, the number of bullish hedge fund positions on Digital Turbine Inc. (NASDAQ:APPS) stock increased by about 10% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with Digital Turbine's growth potential. Our calculations showed that Digital Turbine Inc. (NASDAQ:APPS) isn't ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds' poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out ideas like this under-the-radar stock to identify the next tenbagger. We go through lists like the 10 most profitable companies in America 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. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.