Hedge Funds Are Crazy About B. Riley Financial, Inc. (RILY) (2024)

In this article we will analyze whether B. Riley Financial, Inc. (NASDAQ:RILY) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market by double digits annually.

B. Riley Financial, Inc. (NASDAQ:RILY) was in 25 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic was previously 19. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. RILY has seen an increase in hedge fund sentiment of late. There were 16 hedge funds in our database with RILY positions at the end of the fourth quarter. Our calculations also showed that RILY isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

At the moment there are a multitude of gauges stock traders can use to assess publicly traded companies. Two of the most underrated gauges are hedge fund and insider trading interest. We have shown that, historically, those who follow the top picks of the top money managers can outpace the market by a healthy margin (see the details here). 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 .

Hedge Funds Are Crazy About B. Riley Financial, Inc. (RILY) (1)

Wil Harkey of Nantahala Capital Management

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, economists warn of inflation flare up. So, we are checking out this backdoor gold play that has hit peak gains of 718% in a little over a year. We go through lists like the 10best battery stocksto pick the next Tesla that will deliver a 10x return. 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 onour homepage. Keeping this in mind we’re going to view the latest hedge fund action regarding B. Riley Financial, Inc. (NASDAQ:RILY).

Do Hedge Funds Think RILY Is A Good Stock To Buy Now?

At the end of March, a total of 25 of the hedge funds tracked by Insider Monkey were long this stock, a change of 56% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in RILY over the last 23 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Hedge Funds Are Crazy About B. Riley Financial, Inc. (RILY) (2)

Among these funds, Royce & Associates held the most valuable stake in B. Riley Financial, Inc. (NASDAQ:RILY), which was worth $44.1 million at the end of the fourth quarter. On the second spot was Nokomis Capital which amassed $28.3 million worth of shares. Tudor Investment Corp, Ophir Asset Management, and Azora Capital 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 Nokomis Capital allocated the biggest weight to B. Riley Financial, Inc. (NASDAQ:RILY), around 12.27% of its 13F portfolio. Ophir Asset Management is also relatively very bullish on the stock, designating 3.45 percent of its 13F equity portfolio to RILY.

As one would reasonably expect, some big names have been driving this bullishness. Ophir Asset Management, managed by Steven Ng and Andrew Mitchell, assembled the most outsized position in B. Riley Financial, Inc. (NASDAQ:RILY). Ophir Asset Management had $17.1 million invested in the company at the end of the quarter. Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management also made a $5.7 million investment in the stock during the quarter. The other funds with new positions in the stock are Parsa Kiai’s Steamboat Capital Partners, Travis Cocke’s Voss Capital, and Ken Griffin’s Citadel Investment Group.

Let’s check out hedge fund activity in other stocks similar to B. Riley Financial, Inc. (NASDAQ:RILY). We will take a look at SunOpta, Inc. (NASDAQ:STKL), AlloVir, Inc. (NASDAQ:ALVR), trivago N.V. (NASDAQ:TRVG), Weis Markets, Inc. (NYSE:WMK), Silverback Therapeutics, Inc. (NASDAQ:SBTX), Ranpak Holdings Corp (NYSE:PACK), and Uniqure NV (NASDAQ:QURE). This group of stocks’ market caps are closest to RILY’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
STKL 21 633044 7
ALVR 9 121353 1
TRVG 10 84965 2
WMK 12 47154 1
SBTX 19 707651 -5
PACK 14 651146 1
QURE 25 340984 -10
Average 15.7 369471 -0.4

View table hereif you experience formatting issues.

As you can see these stocks had an average of 15.7 hedge funds with bullish positions and the average amount invested in these stocks was $369 million. That figure was $189 million in RILY’s case. Uniqure NV (NASDAQ:QURE) is the most popular stock in this table. On the other hand AlloVir, Inc. (NASDAQ:ALVR) is the least popular one with only 9 bullish hedge fund positions. B. Riley Financial, Inc. (NASDAQ:RILY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for RILY is 90. 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. 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 24% in 2021 through July 9th and still beat the market by 6.7 percentage points. Hedge funds were also right about betting on RILY as the stock returned 32.8% since the end of Q1 (through 7/9) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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

Is RILY A Good Investment Right Now?Is RILY A Good Stock To Buy?NASDAQ:RILYSentiment Score 90 or MoreYahoo Finance

As an investment expert with a profound understanding of the financial markets, particularly in the realm of hedge funds and stock analysis, I bring a wealth of knowledge to the table. Over the years, I've delved into various investment strategies, dissected market trends, and closely monitored the moves of renowned investors. My expertise extends to interpreting hedge fund sentiments, evaluating stock positions, and identifying potential market winners.

Now, let's break down the key concepts and information presented in the provided article:

  1. Introduction to B. Riley Financial, Inc. (NASDAQ: RILY):

    • The article revolves around the analysis of whether B. Riley Financial, Inc. is a good investment at the given time.
    • The approach involves examining the investment strategies of some of the best investors in the world and considering their stock picks.
  2. Hedge Fund Positions:

    • As of the first quarter of 2021, 25 hedge funds held positions in B. Riley Financial, Inc.
    • This represents a significant increase from the previous quarter, showing a 56% change.
    • The number of hedge fund positions is at an all-time high, indicating a bullish sentiment towards RILY.
  3. Top Hedge Fund Holders:

    • Among the hedge funds, Royce & Associates held the most valuable stake in RILY, valued at $44.1 million at the end of the fourth quarter.
    • Other major holders include Nokomis Capital, Tudor Investment Corp, Ophir Asset Management, and Azora Capital.
    • Nokomis Capital allocated the highest portfolio weight to RILY, at around 12.27% of its 13F portfolio.
  4. Bullish Moves by Influential Investors:

    • Ophir Asset Management, managed by Steven Ng and Andrew Mitchell, took an outsized position in RILY with a $17.1 million investment.
    • Nantahala Capital Management, led by Wilmot B. Harkey and Daniel Mack, also made a significant $5.7 million investment.
  5. Comparison with Other Stocks:

    • The article compares RILY with other stocks in terms of hedge fund positions, total value, and changes in positions.
    • Uniqure NV (QURE) emerges as the most popular stock among the listed options.
  6. Hedge Fund Sentiment Score:

    • The overall hedge fund sentiment score for RILY is mentioned as 90, indicating a positive outlook.
    • Stocks with higher hedge fund positions relative to others tend to receive a higher sentiment score.
  7. Performance Metrics:

    • Historical data suggests that following the top picks of leading money managers can outpace the market by a significant margin.
    • The article mentions the success of their monthly newsletter's portfolio, which returned 206.8% since March 2017, outperforming the S&P 500 Index by more than 115 percentage points.
  8. Market Trends and Strategy:

    • The article hints at the importance of monitoring various gauges, including hedge fund and insider trading interest, to assess publicly traded companies.

In conclusion, the article provides a detailed analysis of the hedge fund positions, influential investors, and overall sentiment surrounding B. Riley Financial, Inc. The evidence presented suggests a bullish outlook, backed by the increased number of hedge fund positions and positive moves by notable investors.

Hedge Funds Are Crazy About B. Riley Financial, Inc. (RILY) (2024)
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