Shares of Impinj (NASDAQ:PI) fell 21% in October, according to data from S&P Global Market Intelligence. The maker of chips, signal readers, and software systems for radio frequency identification (RFID) saw several large investors reducing their interest in the company.
According to records kept by Nasdaq, three of Impinj's 10 largest institutional shareholders reduced their stakes in the company during the quarter that ended on Sept. 30. When these trades were reported on Oct. 10, Impinj's share prices plunged 15%. The third-largest owner, global asset manager BlackRock (NYSE:BLK), sold off 8% of its existing interest; boutique investment firm Gilder Gagnon Howe slashed its holdings by 5%, and hedge fund AWM Investment Company sold 27% of its Impinj shares.
It's unclear why BlackRock and friends decided to reduce their Impinj holdings over the summer, but these decisions are not made on a whim. In any case, this clearly wasn't a benign wave of profit-taking.
Yes, the stock gained nearly 16% in September alone, but was still trading 50% lower from a 52-week perspective at that point. Personally, I still like the company's unique leadership status in a market with terrific long-term prospects, but many of its largest clients overstuffed their warehouses with surplus RFID materials in 2017 and have been slow to work their way through that oversupply. I'm still waiting for a long-overdue rebound, and it's not a good sign to see these major investors losing patience and cashing in some of their chips here.
The stock has bounced back in early November, repairing some of the damage done in October with a 4.7% gain. Like most of last month's moves, this rebound came on a day free of Impinj-specific news, simply amplifying the direction of the general stock market's moves.