At Insider Monkey, we pore over the filings of nearly 866 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of March 31st. In this article, we will use that wealth of knowledge to determine whether or not Jamf Holding Corp. (NASDAQ:JAMF) makes for a good investment right now.
Is JAMF a good stock to buy? Money managers were in a pessimistic mood. The number of bullish hedge fund positions decreased by 9 lately. Jamf Holding Corp. (NASDAQ:JAMF) was in 17 hedge funds’ portfolios at the end of March. The all time high for this statistic is 26. Our calculations also showed that JAMF isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 26 hedge funds in our database with JAMF holdings at the end of December.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
Chase Coleman of Tiger Global
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. 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. Now let’s take a gander at the key hedge fund action regarding Jamf Holding Corp. (NASDAQ:JAMF).
Do Hedge Funds Think JAMF Is A Good Stock To Buy Now?
At first quarter’s end, a total of 17 of the hedge funds tracked by Insider Monkey were long this stock, a change of -35% from the previous quarter. On the other hand, there were a total of 0 hedge funds with a bullish position in JAMF a year ago. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
More specifically, Vista Equity Partners was the largest shareholder of Jamf Holding Corp. (NASDAQ:JAMF), with a stake worth $2572.9 million reported as of the end of March. Trailing Vista Equity Partners was Tiger Global Management LLC, which amassed a stake valued at $98.1 million. Black-and-White Capital, No Street Capital, and Select Equity Group were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Vista Equity Partners allocated the biggest weight to Jamf Holding Corp. (NASDAQ:JAMF), around 37.45% of its 13F portfolio. No Street Capital is also relatively very bullish on the stock, designating 2.28 percent of its 13F equity portfolio to JAMF.
Since Jamf Holding Corp. (NASDAQ:JAMF) has faced declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there was a specific group of funds that elected to cut their positions entirely in the first quarter. Interestingly, Andreas Halvorsen’s Viking Global dropped the largest investment of the 750 funds monitored by Insider Monkey, valued at about $18.1 million in stock, and Anand Parekh’s Alyeska Investment Group was right behind this move, as the fund cut about $15.2 million worth. These moves are important to note, as aggregate hedge fund interest fell by 9 funds in the first quarter.
Let’s also examine hedge fund activity in other stocks similar to Jamf Holding Corp. (NASDAQ:JAMF). These stocks are Artisan Partners Asset Management Inc (NYSE:APAM), Community Bank System, Inc. (NYSE:CBU), Parsons Corporation (NYSE:PSN), Premier Inc (NASDAQ:PINC), American Well Corporation (NYSE:AMWL), ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD), and Avnet, Inc. (NYSE:AVT). All of these stocks’ market caps are closest to JAMF’s market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position APAM,21,279518,0 CBU,8,29233,-5 PSN,9,29095,-9 PINC,19,159312,2 AMWL,19,145488,0 ACAD,33,1482361,-5 AVT,27,850445,2 Average,19.4,425065,-2.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.4 hedge funds with bullish positions and the average amount invested in these stocks was $425 million. That figure was $2745 million in JAMF’s case. ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) is the most popular stock in this table. On the other hand Community Bank System, Inc. (NYSE:CBU) is the least popular one with only 8 bullish hedge fund positions. Jamf Holding Corp. (NASDAQ:JAMF) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for JAMF is 33.6. 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 JAMF wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); JAMF investors were disappointed as the stock returned -10.2% 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.